Manufacturers want clear rules, sufficient transition time and practical solutions before the new eTIMS stock management system is fully operational.
The concerns come as Kenya Revenue Authority moves to introduce an additional function requiring businesses to electronically account for movements of goods through their operations, including purchases, receipts, sales, transfers, returns, adjustments and disposals.
KRA issued a public notice on September 7, 2026, requiring taxpayers engaged in business to maintain accurate and up-to-date stock records through TIMS/eTIMS.
The authority has since embarked on consultations with businesses and other stakeholders before implementing the functionality.
The consultations are expected to address technical and operational challenges, with manufacturers seeking clarity on how the system will interact with existing enterprise resource planning (ERP) systems and other government platforms.
Kenya Association of Manufacturers has particularly raised concerns over the treatment of different manufacturing processes, acceptable stock variances, imports and movement of goods between warehouses.
KAM chief executive Tobias Alando said manufacturers need certainty on the requirements before the system goes live.
“Over the years, we have collaborated to sensitise our members on taxation issues and processes. We are keen to engage our members so that their feedback is heard and reflected, ensuring the system is well aligned to the realities of manufacturing by the time it is rolled out.”
He spoke during a meeting with KRA led by commissioner for micro and small taxpayers George Obell.
One of the biggest issues for manufacturers is integration where many large companies already operate sophisticated ERP systems that track raw materials, work-in-progress, finished products, sales and warehouse movements.
KAM wants clarity on how such systems will connect with eTIMS and what variances will be acceptable where physical stock does not immediately match electronic records.
The association has also asked KRA to clarify how manufacturing processes involving conversion of raw materials into finished products will be captured.
This is significant for factories where a single production process can involve wastage, by-products, damaged goods, samples and other materials that do not necessarily result in a conventional sale.
KAM is also seeking clarity on whether the stock management functionality will be integrated with the Integrated Customs Management System (iCMS), given manufacturers’ reliance on imported raw materials and other inputs.
Other issues include documentation for imports, inter-warehouse transfers, promotional goods and samples, as well as procedures for explaining legitimate stock variances.
Manufacturers are also concerned about what happens when the KRA system experiences downtime, particularly where businesses need to receive or dispatch goods continuously.
Obell said the stock tracking initiative is intended to tackle missing-trader transactions, where businesses generate tax invoices without genuine underlying commercial transactions, reducing their tax liabilities.
The authority also sees stock tracking as a way of preventing market distortions and promoting fair competition between compliant and non-compliant businesses.
According to KRA, the stock management functionality is designed to help taxpayers maintain their own inventories while improving the accuracy of tax returns and reporting.
The authority’s existing eTIMS architecture already contains stock management functions covering stock inventory, stock by item, imported items, stock-in and stock-out histories, stock movements and opening and closing stock.
KRA’s technical documentation also provides for electronic transmission of inventory movements between branches and the authority’s system.
The discussions come as manufacturers continue to push for a predictable tax environment, arguing that frequent changes or unclear implementation requirements can increase operating costs and complicate investment decisions.
The latest engagement between KRA and KAM indicates that preparations are being made for a January 2027 rollout, giving manufacturers a few months to align their systems, train staff and resolve outstanding technical questions.
The transition for businesses will therefore not simply involve issuing electronic invoices but will require maintaining a consistent digital record of goods from the point of purchase or import through production, storage, transfer and eventual sale or disposal.
