This archive report was first published on 15 November 2019.
Kenya's import-dependent economy is set to feel the pinch as increased charges for railway development and product declaration take effect under Finance Act 2019, effective November 7, 2019.
According to the Kenya Revenue Authority, the revised rates of railway development levy (RDL) have been increased to two percent, up from 1.5 percent, while the import declaration fee (IDF) has been raised to 3.5 percent, from two percent.
Shippers Council of Eastern Africa executive officer Gilbert Langat has expressed concerns over the impact of increasing the two levies, describing it as double taxation on importers.
“RDL is an additional charge since it is paid in all imported goods and this will have ripple effects on consumers,” said Mr Langat.
He further noted that the enhanced rates will make it expensive for traders who import millions of units, as each item is subjected to an advance IDF of around Sh5,000.
Kenya relies heavily on importation of food items and manufactured goods, including clothes, utensils, electronics, and vehicles.
The railway development charges were introduced in 2013 to help fund the construction and operations of the line to finance multi-billion-shilling projects.
