A massive discrepancy between Kenya’s import records and China’s export data has renewed concerns over possible tax leakages and trade misinvoicing, after official figures showed that goods worth Ksh.629 billion imported from China in 2025 are missing from the Kenya Revenue Authority’s (KRA) records.
According to data from China’s General Administration of Customs (GACC), exports to Kenya totaled Ksh.1.3 trillion in 2025. However, KRA recorded imports from China worth only Ksh.672 billion during the same period, leaving an unexplained gap that has sparked concerns among economists and tax experts.
The discrepancy is particularly striking because Kenya’s import figures are calculated on a cost, insurance, and freight (CIF) basis, meaning they should generally exceed China’s export values, which are recorded before shipping and insurance costs. Instead, Kenya’s reported imports are significantly lower than China’s export data.
The gap has persisted for at least five years, with cumulative differences reaching Ksh.2.76 trillion between 2021 and 2025. During that period, China reported exports to Kenya worth Ksh.5.35 trillion, while KRA recorded imports totaling only Ksh.2.59 trillion.
Economists say such a large and persistent mismatch could point to under-declaration of imports, trade misinvoicing, customs fraud, or other forms of revenue leakage that deprive the government of billions of shillings in tax collections.
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Churchill Ogutu, Head of Research at Capital A Investment Bank, said the scale of the discrepancy has significant policy implications.
According to the report, if a substantial portion of the missing imports escaped customs declaration, Kenya may have lost considerable revenue from import duties, VAT, import declaration fees, and other levies collected on imported goods.
China has remained Kenya’s largest source of imports for more than a decade, supplying nearly a quarter of all goods entering the country. Electronics, machinery, steel products, clothing, and household goods account for a significant share of the imports from the Asian manufacturing giant.
The Treasury has previously acknowledged the problem and outlined plans for KRA to strengthen cooperation with foreign tax authorities, particularly China, to verify the true value of high-risk imports. The initiative forms part of Kenya’s Medium-Term Revenue Strategy, which seeks to combat trade misinvoicing and improve customs compliance through greater exchange of information with international tax agencies.
Trade misinvoicing typically involves manipulating the declared price, quantity, or quality of imported goods to reduce customs duties or move money across borders illegally. Authorities believe electronics such as mobile phones and computers are among the products most susceptible to undervaluation.
The KRA had not responded to detailed questions regarding the discrepancy at the time of publication. Meanwhile, customs revenue remains one of the government’s largest sources of tax income, with the authority collecting Sh733.7 billion in customs taxes during the nine months to March 2026—about 36 percent of total tax collections.
