Kenya Loses Sh9bn Yearly to Illicit Cigarette Trade - Report

Nairobi — A newly published report has revealed that Kenya is losing billions annually due to a surge in black-market cigarette sales, now comprising a staggering 37 percent of the nation's tobacco trade.

The report, compiled by global insights company Kantar, indicates that more than one out of every three cigarettes consumed within Kenya is unregulated, escaping taxation and costing the government a projected Sh9 billion each year in foregone income.

This represents a sharp rise from the previous year's estimate of 27 percent, highlighting a growing challenge.

In tandem, smuggling-related figures are escalating.

Data from the Kenya Revenue Authority (KRA) shows the declared worth of illicit goods entering Kenya grew by Sh43.5 million, hitting Sh243.5 million in 2024.

British American Tobacco (BAT) Kenya's Managing Director, Crispin Achola, voiced serious alarm about the trend, emphasizing both its fiscal and national security implications.

"This alarming rise in illegal cigarette trade is not only depriving the Kenyan government of vital revenue needed for the country's economic stability, but is also undermining the security and livelihoods of thousands of Kenyans in our value chain," said Achola.

According to Kantar's research, the majority of the contraband originates from Uganda, pointing to transnational smuggling networks that exploit porous borders.

The influx of illegal tobacco goods into Kenyan markets is almost entirely driven by covert cross-border operations.

Achola urged prompt and collective efforts to address the issue, stressing that it places both jobs and national stability at risk.

Though Kenya and its regional partners have taken steps to combat this shadow economy, BAT Kenya has reiterated the need for stronger collaboration across sectors, including government bodies, law enforcement, civil society, and the media, to close enforcement loopholes.

The report underscores the urgent need to reevaluate border oversight, enhance crackdown mechanisms, and consider the broader economic toll of rampant illicit trade.

Read the original article on Capital FM.