What happened

The Kenya Revenue Authority (KRA) announced an amendment to the import duty schedule that reduces the tax burden on imported construction tiles and ceramic sinks. The amendment was published in the official Gazette and took effect shortly after the announcement, signalling a clear policy shift to support the building sector. Under the new schedule, the duty rates for these two product categories have been lowered compared with the previous rates that applied to most construction imports. KRA officials indicated that the move is part of a broader effort to stimulate activity in the housing and commercial construction markets, which have faced cost pressures in recent years. Industry observers expect that the lower taxes will translate into lower purchase prices for contractors, developers and retail outlets that source these items from overseas. The change was reported by People Daily, confirming the government's intent to make building materials more affordable for Kenyan businesses.

Context and background

The amendment follows a series of consultations that KRA held with the Kenya Builders Association, the Construction Industry Development Board and major importers of building materials. In the months leading up to the decision, stakeholders highlighted that high import duties on tiles and ceramic fixtures had contributed to inflated project budgets, especially for middle‑income housing schemes. KRA’s Director of Customs, in a statement to the press, explained that the revised rates were calibrated after reviewing revenue forecasts and the need to keep construction costs competitive against regional peers such as Tanzania and Uganda. Historically, Kenya has relied heavily on imported finishing materials, with a large share of tiles and sinks arriving from China, Turkey and the United Arab Emirates, making duty levels a critical cost component.

Earlier this year, the government introduced a fiscal stimulus package aimed at reviving the construction sector, which had slowed due to a combination of high interest rates, supply chain disruptions and the lingering effects of the COVID‑19 pandemic. The stimulus included incentives for affordable housing developers, but many of those incentives were offset by the high duty burden on imported finishes. By aligning the duty reduction with the broader stimulus, KRA hopes to create a more coherent policy environment that encourages private investment without eroding the tax base. The amendment also reflects a trend in the East African Community to harmonise trade tariffs, facilitating smoother cross‑border movement of construction inputs.

While the specific duty percentages were not disclosed in the People Daily report, KRA officials confirmed that the new rates are “significantly lower” than the previous schedule, which placed tiles and ceramic sinks in the same bracket as other high‑value construction imports. The amendment also includes a provision for periodic review, allowing the authority to adjust rates in response to market conditions and revenue considerations. For importers, the change means revising customs declarations, updating pricing structures and communicating the new cost base to customers. The reduced duty is expected to be reflected in invoices within a few weeks, once customs officers implement the updated tariff codes.

Compared with what is normal

Under the prior tariff regime, tiles and ceramic sinks were taxed at the standard construction material rate, which historically has been higher than rates applied to raw building inputs such as cement or steel. The new amendment places these finishes in a lower‑rate category, aligning them more closely with other finished goods that receive preferential treatment to promote local consumption. This shift contrasts with the typical practice of maintaining a uniform duty across all construction imports, a policy that many analysts argued had unintentionally raised the overall cost of building projects. By lowering the duty specifically for tiles and sinks, KRA is deviating from the usual flat‑rate approach and targeting items that represent a sizable share of finishing costs. The adjustment also mirrors similar moves in neighbouring countries, where reduced tariffs on building finishes have been used to boost domestic construction activity.

• Previously, tiles and ceramic sinks were grouped with high‑value construction imports, attracting a duty that added substantially to landed costs.
• The amendment creates a distinct, lower‑rate bracket for these products, separating them from the broader construction category.
• Other construction inputs such as cement, iron rods and timber continue to be taxed at the standard rates, which remain unchanged.
• Importers are expected to see a reduction in the overall landed cost of tiles and sinks, potentially ranging from a few percent to double‑digit savings, depending on the original duty applied.
• The change aligns Kenya’s tariff structure with regional competitors that have already implemented lower duties on similar finished goods.

Why it matters

The reduction in import duties directly lowers the cost of two of the most visible and frequently purchased finishing items in any building project, meaning developers can allocate saved funds to other critical areas such as labor, design or even expand the scale of a project. For small and medium‑sized contractors, the lower duty can improve cash flow, allowing them to bid more competitively for contracts and potentially win more work in a market where price sensitivity is high. Retailers and wholesalers of tiles and ceramic sinks will likely see an increase in volume as the lower landed cost makes these products more attractive to end‑users, which could stimulate local distribution networks and create ancillary jobs. Moreover, the policy may encourage the adoption of higher‑quality imported finishes, as the price gap between premium and standard options narrows, potentially raising overall construction standards in Kenya. Finally, the amendment demonstrates the government’s willingness to adjust fiscal levers in response to sectoral feedback, offering a signal to investors that the regulatory environment can be responsive and supportive of growth.

Practical steps

• Review your current inventory and upcoming procurement plans to identify tiles and ceramic sinks that can be sourced under the new duty rates.
• Contact your customs broker or freight forwarder to confirm the updated tariff codes and ensure that customs declarations reflect the lower duty.
• Adjust your project budgets and cost estimates to incorporate the expected savings, and communicate the revised figures to clients or stakeholders.
• Monitor the market for any price adjustments from suppliers, as reduced duties may lead to competitive pricing that can further benefit your bottom line.
• Stay informed about future KRA notices, as the authority has indicated that the duty schedule will be reviewed periodically.

Tax Planning & Compliance services at Beavoren Ventures can help you navigate the new duty structure, ensuring that your import documentation is accurate and that you capture all eligible savings. Our team can also advise on broader tax implications of the amendment for your construction business.

Talk to our team at Beavoren Ventures - info@beavorenventures.co.ke - to set up your systems correctly.

Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.