Kenya Pushes Tax Harmony, Drones to Curb Smuggling at Uganda Border

Kenya’s two main border crossings with Uganda are collecting more revenue than before but lawmakers want the government to look beyond customs enforcement and address the tax differences they say still make smuggling commercially attractive.

• Revenue collected at Malaba alone collected KSh11.04 billion in the year ended June 2026, exceeding its KSh10.62 billion target, as the border post handled about 2,200 trucks a day - according to border officials.
• Higher collections have not closed the gap between formal trade and the more furtive commerce moving around it, as border officials told the National Assembly’s Select Committee on Regional Integration that goods continue to cross through non-gazetted routes, depriving respective governments of revenue and leaving legitimate traders competing with businesses that avoid customs charges.
• The committee now wants EAC countries to harmonize tax rates, arguing that differences in the cost of bringing goods into neighbouring markets can encourage traders to seek cheaper, unofficial routes.

For businesses operating along the border, the tax differential can turn customs avoidance from a clandestine nuisance into a calculation of margins.

The lawmakers are also for stronger technological controls including drones and improved scanners at the border posts to help authorities watch areas beyond the formal crossing points and detect concealed or undeclared cargo.

“We use non-intrusive scanners to manage risk and ensure tax compliance. However, we need more advanced machines as technology evolves rapidly. Provision of drones for border surveillance would greatly improve revenue collection, as we are losing a lot through non-gazetted routes,” the border officials told the lawmakers. 

Busia and Malaba are also among the principal gateways for road freight between Kenya and Uganda, and congestion can raise costs for businesses that comply with the rules. The committee heard that inadequate truck parking could become a more serious constraint as traffic increases over the next five years.

"The current holding yard is small for the 2,200 trucks that we handle daily, which leads to traffic snarl-ups, delays in cargo clearance, inconvenience to the public and security concerns. It also affects the ability of customs and Participating Government Agencies (PGAs) to efficiently manage the flow of cargo,” said the Malaba Station Manager, Roderick Mulei. 

"The yard is not paved to guarantee the safety of trucks. The road loop for outbound trucks to Uganda has been pending for the longest time, and this has affected the efficiency of the border. It becomes difficult to coordinate the movement of trucks, pedestrians and boda bodas," he added. 

To address the challenge, lawmakers also want authorities to consider additional border points as trade volumes grow. The government is also yet to break ground on a planned 40-acre Jumuia Market near the border. The project remains stuck at the preparatory stage, with title acquisition and design work still pending.