Kenya’s Standards Levy Guide

What is the Standards Levy?

The Standards Levy is not a new fee—it has existed for years under the Standards Act. However, significant changes were introduced in 2025 that every manufacturer needs to understand. The updated Standards (Standards Levy) Order, 2025 brings major adjustments to how much you pay, who pays, and how compliance works.

How Much Do You Pay?

You pay 0.2% of your monthly sales after removing three specific deductions:

1. Value Added Tax (VAT) you charged customers
2. Excise Duty (if your product has this tax)
3. Discounts you gave to customers

Who Doesn’t Have to Pay?

Small manufacturers get a break! If your annual sales are KSh 5,000,000 or less, you pay nothing. But you still need to register with KEBS.

Cap for Large Companies

Even though the rate is 0.2% for everyone, there’s a maximum limit:

• 2025-2030: No manufacturer pays more than KSh 4,000,000 per year
• 2031 onwards: Maximum increases to KSh 6,000,000 per year

This means large companies with billions in sales pay an effective rate lower than 0.2% once they hit the cap.

Who Must Register and Pay?

If you do any of these activities, you’re covered:

1. BUILDING & CONSTRUCTION

Construction companies, contractors, material manufacturers, plumbers, electricians, masons, roofers, flooring installers, fencing companies, quarry operators, furniture makers, and stone processors.

2. TEXTILES & APPAREL

Clothing manufacturers, shoe makers, leather processors, handbag producers, textile mills, spinning factories, dyeing plants, dry cleaners, and leather goods workshops.

3. MECHANICAL ENGINEERING

Vehicle assemblers, metal fabricators, repair garages, panel beaters, lift installers, refrigeration companies, fuel system installers, machinery manufacturers, and spare parts producers.

4. ELECTRICAL ENGINEERING

Electrical contractors, software developers, network installers, CCTV companies, computer repair services, medical equipment installers, power generation firms, and alarm system providers.

5 .FOOD & AGRICULTURE

Food processors, bakeries, abattoirs, millers, coffee/tea processors, animal feed producers, fruit/vegetable packers, seed companies, and tobacco processors.

6. CHEMICALS & ALLIED

Pharmaceutical manufacturers, paint producers, cosmetic makers, soap factories, fertilizer producers, plastic manufacturers, adhesive makers, printing companies, and chemical compounders.

SPECIAL CASES ALSO INCLUDED

ALSO LIABLE:

• Export manufacturers
• EPZ/SEZ manufacturers (unless specifically exempted)
• Contract manufacturers
• Private label producers
• Companies assembling imported parts
• Packaging/repackaging operations
• Government manufacturing entities
• Non-profits selling manufactured goods

Deadlines

• Pay by the 20th of every month for the previous month’s sale
• Late payments get a 5% monthly penalty that keeps adding up

How to Pay

1. Register on KEBS KIMS portal: https://kims.kebs.org
2. Calculate your monthly levy
3. Pay online through KRA iTax system
4. Submit Form 3

Keep records for 7 years including sales receipts, VAT documents, and payment confirmations.

What Happens If You Don’t Pay?

1. Automatic 5% penalty each month you’re late
2. Certificate of Compliance can be cancelled
3. Risk losing government tenders
4. Possible legal action by KEBS

CRITICAL REMINDER: The 2025 Order expanded coverage significantly. Even if you weren’t liable before, you may be liable now. Check the 95 activities carefully—the list is specific and comprehensive. When in doubt, register and seek clarification from KEBS. Penalties for non-compliance are severe and automatic through the integrated iTax system.

Disclaimer: This guide provides general information based on current law and legal interpretations. It does not constitute legal advice. Manufacturers should consult qualified tax professionals for advice on specific situations.

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