Kenya is losing an estimated Sh9 billion annually due to a surge in black-market cigarette sales, which now account for 37% of the nation’s tobacco trade, according to a newly published report by global insights firm Kantar.
The findings paint a sharp increase from 27% in 2024, signaling a worsening crisis in illicit trade .
The report reveals that more than one in three cigarettes sold in Kenya evade taxation, depriving the government of critical revenue needed for public services and development programs.
The Kenya Revenue Authority (KRA) reported that the value of smuggled goods entering the country rose by Sh43.5 million in 2024, reaching Sh243.5 million, with cigarettes being a major contributor .
Most illicit cigarettes are smuggled from Uganda, exploiting weak border controls and porous entry points.
British American Tobacco (BAT) Kenya Managing Director Crispin Achola warned that the trend not only harms the economy but also fuels organized crime and threatens national security.
“This alarming rise in illegal cigarette trade is undermining Kenya’s economic stability and jeopardizing thousands of legitimate jobs,” Achola stated, calling for urgent multi-agency action to curb the smuggling networks .BAT Kenya has urged tighter border surveillance, stricter penalties, and collaboration between government agencies, law enforcement, and regional bodies like the East African Community (EAC) to combat the illicit trade.
The report emphasizes the need for policy reforms and public awareness campaigns to deter consumers from purchasing untaxed cigarettes .
The surge in smuggling mirrors challenges in other sectors, such as sugar and gold trafficking, where weak enforcement has allowed illicit trade to thrive.
Experts warn that without decisive action, Kenya’s economy will continue to bleed billions annually, while criminal networks grow stronger .
Authorities are under increasing pressure to implement tracking systems and harmonize tax policies with neighboring countries to close loopholes exploited by smugglers. For now, the Sh9 billion loss remains a stark reminder of the costly battle against illicit trade.
