Traders dealing in used clothes commonly known as mitumba are crying foul over the move by Kenya Revenue Authority (KRA) to increase of import duty on second-hand clothes and delays at Mombasa port, which they claim, are driving them out of businesses.

Some are threatening to leave for neighbouring states where taxes are lower. Others are importing clothes through Tanzania due to relatively lower taxes.

Shippers have also threatened to increase shipping charges by Sh68,000 per container.

Shippers’ spokesperson, Mr Cosmos Mutua, says the importers will now pay Sh459,000 up from Sh391,000.

INCREASE IN TAXES

The taxman increased the charges to Sh2.1 million, up from Sh1.3 million per container leading to increased prices of second hand clothes.

A bale that used to cost Sh11,000 has now doubled.

Some traders say that they have been unable to clear their containers leading to their pile up at the Mombasa port, while others are said to have closed shop due to dwindling sales arising.

It is estimated that about 200 containers are lying at the port awaiting collection due to high charges.

Timothy Kariuki, a second-hand clothes trader in Ngara says the cost of ladies blouses he specialises in, have gone up by between Sh100 and Sh200.

The new prices are driving away clients, he says.

“I used to earn Sh20,000 daily but this has tremendously gone down. We can hardly make even Sh5,000 as many of our customers now prefer ready-made clothes because they are cheaper following the tax hike which has forced us to increase prices,” laments Kariuki.

TRADERS’ GRIEVANCES

James Onyango whose shoe shop in Ngara looks deserted despite having the latest ladies’ designer shoes, says he sells about two pairs a day since the hike.

“I used to sell more than 10 pairs, but now business has plummeted. Most of my clients are complaining that the cost is too high, and we might be edged out of business if KRA fails to review the duty,” says Onyango, who also owns another shop at Adams Arcade in Nairobi.

Onyango says the traders are not opposed to paying tax but want KRA to negotiate with them.

“We want the government to review the tax structure to enable us stay in business ,” he says.

However, the KRA defended the hike.

KRA Commissioner of Customs Wambui Namu says the hike was implemented to address weaknesses in tax administration after negotiations with the traders’ umbrella body — Gikomba Wholesalers on December 1.

“We identified used clothing as prone to risk of undervaluation in relation to prices prevailing in the source market,” she says.

(Xinhua)

Do you have a story or an article to publish? Please email us to submit@in2eastafrica.net.