Kenya loses Sh9 Billion to rising illicit cigarette trade

Kenya is losing over Sh9 billion annually in taxes and levies due to the growing trade in illicit cigarettes, a new report by global research firm Kantar has revealed. The study shows that more than one in three cigarettes sold in Kenya today are illegal and untaxed, costing the government massive revenue.

British American Tobacco (BAT) Kenya is raising the alarm, warning that the black market for cigarettes is now at an all-time high. The company says illicit products now make up 37% of the market, up from 27% just a year ago. “This is not just an economic issue; it’s a threat to jobs, security, and public health,” said BAT Kenya Managing Director Crispin Achola.

Most of the illegal cigarettes are smuggled in from neighboring countries, bypassing border checks. Last year alone, KRA seized counterfeit goods worth Sh243.5 million at points of entry, up from Sh200 million. The Kenya Revenue Authority has been using the Excisable Goods Management System (EGMS) to detect fake products, but the problem keeps growing.

Illicit trade is also tied to organized crime and puts consumers at risk. According to the Anti-Counterfeit Authority, Kenya loses over Sh153 billion every year to illegal trade. Cigarettes, alcohol, and electronics are the most counterfeited products. These goods often don’t meet safety standards, exposing users to serious health dangers.

BAT Kenya is calling for stronger enforcement and joint efforts to tackle the crisis. “We need urgent and united action from the government, security forces, private sector, and the public,” said Achola. “This is a battle we must fight together to protect our economy, our people, and the future of our country.”