Kenya Revenue Authority probes alleged conspiracy to conceal 33,000 high-end phones worth Sh50m in unpaid taxes
Kenyan authorities are investigating an alleged conspiracy to smuggle 33,000 high-end smartphones through Eldoret International Airport, potentially costing the government Sh50 million in unpaid taxes in what investigators describe as one of the most sophisticated customs evasion schemes uncovered at the facility.
The investigation, launched following a whistleblower complaint, centers on a consignment that arrived aboard a cargo aircraft from one of Africa’s leading airlines on September 18, 2025.
Sources familiar with the matter told this publication that the mobile phones were deliberately misdeclared as clothing and household items to evade import duties and value-added tax.
Kenya Revenue Authority officials, speaking on condition of anonymity due to the ongoing investigation, said the scheme involved “individuals with connections to powerful government figures” and represented a systematic attempt to defraud the state of significant tax revenue.
“We want all concerned parties to pay attention to this issue now. It’s a serious matter as it is denying the government of much needed money,” said one official aware of the investigation.
The case has sent ripples through KRA’s enforcement division, with executives reportedly demanding accountability from airport-based customs officials who may have been complicit in facilitating the alleged fraud.
Investigators have been dispatched to Eldoret to gather evidence and interview relevant personnel.
This latest incident adds to mounting concerns about tax compliance at Eldoret International Airport, which has emerged as a significant entry point for both legitimate trade and illicit goods.
The facility has previously featured in customs enforcement actions, with authorities regularly conducting auctions of seized items including smartphones, laptops, and electronic cigarettes whose importers failed to pay applicable duties.
The timing of the investigation is particularly significant given Health Cabinet Secretary Aden Duale’s recent crackdown on illicit products entering Kenya through various ports of entry.
In June 2025, Duale presided over the destruction of more than 5.5 tonnes of illegal tobacco products seized at Eldoret Airport, describing such smuggling operations as “instruments of harm” that target young people.
“Kenya is a signatory to the WHO protocols to eliminate illicit tobacco products. Our enforcement to eliminate illicit tobacco products is a legal and moral duty that must be undertaken,” Duale said during the destruction ceremony at Moi Teaching and Referral Hospital.
The Health CS subsequently suspended all existing licenses related to nicotine products and warned that the government would not tolerate Kenya becoming “a dumping ground for toxic substances.”
However, the smartphone smuggling case represents a different category of customs evasion, focused primarily on avoiding tax obligations rather than importing prohibited goods.
Industry analysts suggest the scale of the alleged operation – involving 33,000 units – indicates a well-organized network with intimate knowledge of customs procedures and potential insider assistance.
KRA has historically struggled with customs evasion at major ports of entry, with previous cases involving everything from construction materials to consumer electronics.
The authority’s enforcement efforts have intensified in recent years as the government seeks to boost revenue collection amid growing fiscal pressures.
The Eldoret investigation comes as Kenya faces mounting scrutiny over tax compliance, with several high-profile cases currently before the courts.
In April 2025, two contractors were charged with evading Sh290 million in taxes, while other recent cases have involved individuals and companies accused of systematic under-declaration of income and imports.
Officials at KRA declined to provide official comment on the smartphone case, citing the ongoing investigation. However, sources indicate that the authority is treating the matter as a priority given both the scale of the alleged fraud and concerns about potential corruption within its own ranks.
The investigation is expected to determine whether customs officials at Eldoret Airport actively facilitated the scheme or were negligent in their duties.
Early findings could lead to criminal charges against importers, customs brokers, and potentially government officials.
For Kenya’s tax collection efforts, the case highlights ongoing challenges in monitoring and controlling imports at secondary airports, which may lack the sophisticated scanning equipment and oversight mechanisms deployed at major facilities like Jomo Kenyatta International Airport in Nairobi.
The outcome of this investigation is likely to influence KRA’s approach to customs enforcement at regional airports and could result in enhanced screening procedures for high-value consumer electronics, which have become increasingly popular targets for customs fraud due to their compact size and high duty rates.
As the probe continues, it serves as a reminder of the complex challenges facing tax authorities in emerging markets, where sophisticated smuggling operations often exploit gaps in enforcement capacity and, in some cases, benefit from official corruption.
