Many traders importing cargo through Port of Mombasa are facing economic difficulties underlined by the large volume of goods that are being auctioned by the taxman.
An increasing number of importers have been unable to clear their goods, mainly due to the economic challenges posed by the pandemic, forcing the taxman to sell them to safeguard revenues as well as help ease congestion at the port customs warehouses.
The taxman has already conducted three auctions this year and is set for the fourth one tomorrow.
The Kenya Revenue Authority (KRA) is set to auction more than 350 lots tomorrow after complying with Ministry of Health protocols to curb spread of coronavirus.
Next week’s auction will be the fourth this year and has been attributed to the increasing number of importers who had failed to pay taxes for their imported goods as a result of Covid-19 pandemic which has affected most businesses across the globe.
According to importers, the government should have considered giving them more time to clear the goods or offer them special rates during this pandemic period.
“Importers are facing hard times as any other business group but we are yet to see special consideration on us,” said John Kariuki, one of the Mombasa-based importers.
In the more than 350 lots which are set for auctioning in a gazette notice dated July 2, 2021, different goods and vehicles are set to be sold.
The items on the list of auction include clothes, furniture, households,and building materials whose importers had failed to pay duty within the stipulated time so as to decongest different port facilities to improve efficiency.
KRA auction goods and vehicles which have overstayed after owners fail to pay taxes or have been mis-declared to decongest port facilities.
But before the auction, the Commissioner for Customs and Border Control gives a notice by publication in the gazette and if they are not removed within 30 days from the date of notice, the commissioner assumed the goods as abandoned to customs hence they were announced for auction.
During auction, prices are determined by a number of expenses including duties, the expenses of removal and sale, the rent and charges due to the custom, the port charges, freight and any other charges.
The reserve price of goods offered at an auction is set by the Commissioner which includes duties, expenses, rent, freight and other charges. Goods cannot be offered at a price below the reserve price.
During the last auction, the taxman collected Sh202 million in revenue where Sh138 million came from consolidated cargo, Sh27 million obtained from motor vehicle sales and Sh35,489,000 from re-offers.
The next auction in now set for tomorrrow, after KRA received the green light from port health officials on Friday last week to conduct a mini-auction. The exercise was suspended about two weeks ago to give taxman time to comply with Ministry of Health set standards on Covid-19.
Kilindini Sea Port public health officer Zealot Naphtalley said KRA would be allowed to conduct auction in adherence to the set Ministry of Health protocols.
He said two public health officers have been assigned to assist during planning and implementation of the sale so that the function runs in strict adherence to Covid-19 protocols.
In a notice addressed to KRA chief manager Kilindini port operations, Abdi Malik, Mr Naphtalley said his office was ready to cooperate in case of challenges regarding health matters t.
“In recognition that the matter is a very crucial government function, this office has assessed the situation at the port and advice that custom public auction should be supported to take place preferably between Tuesday 17th August 2021 and Thursday 19th August 2021 in order to allow our officers to prepare for the function on the preventive measures of Covid-19,” said the officer.
The Port of Mombasa was identified as one of the hot spots which recorded highest number of Covid-19 infections in the past months but the management has said it has taken measures to secure the port.
The Kenya Ports Authority has even asked those not working in essential areas and those vulnerable especially those aged above 58 years to work from home.