Kenya Moves to Scrap Excise Duties on Imported Eggs, Onions, and Potatoes

The Kenyan government has proposed eliminating excise duties on imported eggs, onions, and potatoes through the Finance Bill, 2025. 

This policy shift is aimed at alleviating consumer burden and resolving regional trade disputes. The move seeks to nullify the 25% tax imposed in 2023, which has been linked to soaring prices and strained relations with neighbouring countries. The contentious levy, initially intended to protect local farmers, inadvertently triggered substantial price increases and exacerbated food insecurity for numerous Kenyan households. 

Potatoes, for instance, surged from an average of Sh107.98 per kilo in early 2023 to Sh126.48 by March 2025. The tax also provoked retaliatory tariffs from Uganda and Tanzania on Kenyan agricultural exports, leading to high-level interventions from East African heads of state and finance ministers to mitigate the escalating trade friction within the East African Community (EAC). The proposed tax removal is expected to provide much-needed relief to Kenyan consumers grappling with high food prices. 

The anticipated decrease in the cost of potatoes, onions, and eggs, primarily sourced from Tanzania and Uganda, could ease financial pressures on struggling households. However, the policy shift raises concerns about potential repercussions for Kenyan farmers, who may face increased competition from cheaper imports flooding the local market. Policymakers must address the challenge of balancing affordable food prices with the sustainability of domestic agriculture. 

The elimination of import taxes holds broader economic and diplomatic implications. Improved trade relations with Uganda and Tanzania, both of which imposed retaliatory tariffs, are anticipated. Removing trade barriers could revitalise regional commerce and foster economic cooperation within the EAC, addressing tensions that have previously stalled progress. 

Kenya's commitment to scrapping the tax aligns with prior assurances made by former Treasury Cabinet Secretary Njuguna Ndung’u during negotiations with EAC finance ministers, who pledged to reconsider the levies to mend fractured trade ties. The move also responds to mounting pressure from local businesses and regional exporters seeking predictability and fairness in cross-border trade policies.