The Kenya Revenue Authority (KRA) has announced a plan to set up a permanent office in Eastleigh, nearly three years after a similar effort to enhance tax compliance in the ever busy business hub collapsed.

Eastleigh is one of the country's top business centres where the taxman needs to set up round-the-clock monitoring to boost revenue collection and compliance among traders.

In an announcement on Thursday, KRA Board Chairman termed Eastleigh's business contribution to the country's economy "invaluable" while unveiling plans to open a permanent office in the zone starting September 2025.

"Eastleigh’s contribution to the economy is invaluable, and we are determined to support your continued growth through structured, responsive, and respectful engagement,” stated Ndiritu Muriithi.

He was speaking when the KRA Board met the Eastleigh Business District Association (EBDA), in talks to firm up "tax compliance, trade facilitation" across the zone's dynamic commercial ecosystem. 

Taxpayers to comply

"Tax is a necessity for any nation as it fuels and finances the state. At KRA, we are committed to making it easier and simpler for taxpayers to comply," he added. 

On his part, EBDA chief executive Mohamed Mero welcomed the taxman's initiative, stating: “We are keen to work together through continuous dialogue, tax education forums and advocacy for practical tax incentives that support our business community."

The taxman's Eastleigh tax centre will add to other offices which KRA has opened across the country in the 2024/2025 financial year including Maua, Wote, Chuka, Eldama Ravine, Iten, Kapenguria, Lodwar, Malaba, Homabay, Migori, Siaya, Kakuma, Kainuk and Tana River.

Structured engagement

KRA and Eastleigh business team agreed to establish a structured engagement framework to facilitate regular consultation, feedback, and resolution of business-related tax matters.

For decades, Eastleigh has evolved into one of Nairobi city's fast growing business hub, particularly known for its commercial activity, especially retail and wholesale, and its growing number of shopping malls. 

The zone now hosts Business Bay Square (BBS Mall), which is arguably the largest shopping mall in East Africa, offering a wide selection of retail shops, dining areas, banking and entertainment spots.

It's often referred to as "Little Mogadishu" due to its predominantly Somali population and the strong Somali influence on its business operations. Additionally, the area is experiencing significant investment in infrastructure and commercial development, including large malls and residential buildings.

However, amid this expansion of business, the community of investors in the zone have increasingly come under close scrutiny by the taxman for tax evasion, cargo dumping and outright suspicion that traders in the area simply "don't pay taxes."

Cargo dumping

Early this year, the KRA working in collaboration with officers from the Directorate of Criminal Investigations, arrested 18 traders on allegations of cargo dumping as part of an elaborate scheme to dodge taxes.

The suspects were accused of tampering with the Regional Electronic Cargo Tracking System by editing a vehicle's registration details while also tampering with electronic seals.

What's more, two years ago, the taxman deployed 1,400 field agents in Eastleigh, a move that was labelled as the most aggressive pursuit on tax cheats in the area at a time when most outlets in the area were managed under 'cash-only' terms, a strategy that was suspected to help them escape KRA's grip.

In 2022, when KRA attempted to open a permanent office in Eastleigh, the strategy was met with unease among traders given the taxman's persistent raids in the area that saw the confiscation of goods worth millions.

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