The National Assembly Finance Committee deleted a five percent tax on Mitumba imports from a draft Finance Bill that had the backing of the Treasury and State House amid pressure to reinstate the duty.
The final Finance Bill published by the committee did not have the tax for the second hand shoes and clothed despite the draft from the Treasury containing the five percent duty.
Addressing multiple taxes levied on second-hand clothes, popularly known as mitumba, at the point of entry are among the reasons the National Treasury proposed the introduction of payment of one off payment of taxes in the Finance Bill, 2026.
National Treasury Cabinet Secretary John Mbadi said the move was also informed by a request from representatives of mitumba traders who complained for a complicated payment of taxes anytime their mitumba consignment lands in the country.
Treasury reckons that State House had backed the introduction of the tax.
‘It was their request, and as an office, and as a government that listens to Kenyans, we believe that it was the right way to go. That is the proposal we took to the National Assembly, but unfortunately, it has been dropped,’ said Mr Mbadi.
The draft from the Treasury is regarded as an informal document, which the Finance committee can make minimal changes before publication of the final Bill, which is subject to public participation.
The National Treasury now wants the proposal reinstated, insisting that it does not harm the country’s thriving mitumba trade that supports over two million jobs.
The current taxation regime sees mitumba traders pay four duties and levies including a 35 percent import duty based on the custom value of imports, charged per kilogram and a 16 percent value added tax (VAT) on imported customs values.
Mitumba importers must also pay levies including the railway development levy (RDL) and the import declaration fee (IDF).
The mitumba traders came up with the proposed harmonized taxation rate for imports as they lamented the current regime which also sees them pay for the duties and levies in US dollars.
‘We recommend that all income duty be paid at the port of entry, upon arrival of goods. All levies and duties should be settled at the port of entry to enhance compliance and accountability,’ the Mitumba Consortium Association of Kenya (MCAK) told the National Treasury in a memorandum seen by this publication.
The consortium has had several engagements with both the National Treasury and State House over the last seven months.
According to a highly placed source at the National Treasury, President William Ruto enquired why the five percent tax rate was being considered and asked for a meeting with both the exchequer and the mitumba traders to understand the taxation dynamics on second-hand clothing articles.
President Ruto agreed to the proposal afterwards and the provision was carried in the draft Finance Bill, 2026.
The source presented this publication with photos, representing receipts of the months’ long engagement between the exchequer and the mitumba traders including MCAK Chairperson Teresia Njenga.