CS Mbadi Explains How Phones Will Be Cheaper Under Finance Bill 2026

Jukwaa

🇰🇪 Breaking It Down

While speaking during an interview on TV47 at the University of Nairobi on May 20, CS Mbadi reiterated that the Finance Bill 2026 proposes replacing the existing multi-layered taxes charged at the port of entry with a single 25 per cent excise duty, applied only when a device is activated on a mobile network.

"People are saying we are increasing excise duty from 10 per cent to 25 per cent, making mobile phones more expensive. Far from it. These are the facts", stated Mbadi.

Currently, anyone importing a phone into Kenya is taxed at the port of entry, including 16 per cent VAT, 10 per cent excise duty, 25 per cent customs duty, a 2 per cent import declaration fee, and a 2.5 per cent railway development levy.

📌 What You Need to Know

Cumulatively, those charges total 55.5 per cent, implying that a phone is taxed heavily before it even reaches a shop shelf or lands in a consumer's hands anywhere in the country.

Under the new proposal under the Finance Bill 2026, all port-of-entry charges would be scrapped, with traders free to import phones without paying any tax until the device is actually sold and switched on.

This implies that taxes would only apply once a phone is purchased and activated by a customer on a mobile network, according to the CS.

With these changes, Mabdi reiterated that the 25 per cent tax proposal will apply only to phone sales; anything else, he said, will harm businesspersons and make the entire taxation process simpler and cheaper in the long run.

“Number one, you are making taxes simple. Very simple, because it is one, and you don't have to calculate VAT, what, what, along the supply chain until it reaches Jikisumu, whatever. No, one tax,” stated Mbadi.

Adding, “Number two, which you are also correcting, is that if the phone has not been sold, no one is paying tax.”

📰 Source: Kenyans.co.ke

0 0