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Customs Taxes and Excise Taxes

Unit: Public Finance and Taxation

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Practice CPA Public Finance and Taxation Customs Taxes and Excise Taxes questions with detailed answers and explanations.

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April 2026

 2 Questions
Question 5a
​​Explain the term “ex-factory selling price” as used in the assessment of excise duty on locally manufactured goods citing TWO components included in its determination.


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Question 5e
​ ​​Fidel Gaming and Logistics Ltd. provided the following data for the month of February 2026:

  1. A total of Sh.15,000,000 was transferred by customers into their betting wallets for placing wagers. The excise duty rate was 5% of amount deposited.
  2. The company imported ceramic sinks and wash basins with a customs value of Sh.5,000,000. The prevailing export and investment promotion levy was at the rate of 3% for ceramics.
  3. The company imported semi-finished iron and non-alloy steel products with a customs value of Sh.10,000,000. The prevailing export and investment promotion levy was at the rate of; 17.5% for steel.
  4. The company paid Sh.2,000,000 to a non-resident person for digital content monetisation services.

Required:

Compute the following taxes arising from the above transactions for the month of February 2026:

(i)   Excise duty on betting.

(ii)  Export and Investment Promotion Levy for ceramics and steel.

(iii) Withholding tax on digital content monetisation.


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December 2025

 2 Questions
Question 3b
​​Evaluate FOUR roles of excise stamp in excise duty management in your country.


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Question 3a
​​Explain the following terms as used in taxation: 
 
(i) Catering levy.
 
(ii) Advalorem customs duty. 


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August 2025

 1 Questions
Question 4a
​​Agrotech Ltd. a Kenyan importer has received a shipment of agricultural machinery from Germany, which has arrived at the port of Mombasa.  
 
As the appointed customs clearing agent, explain FOUR essential import documents you would utilise to ensure the shipment is processed and delivered in accordance with the customs laws in Kenya. 


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April 2025

 3 Questions
Question 4a
​ ​​Identify TWO instruments that are subject to stamp duty as per the Stamp Duty Act (Cap 480).


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Question 4b
​ ​​Analyse FOUR circumstances under which excise duty paid could be refunded to the taxpayer.


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Question 5a
​​Analyse FOUR reasons why an importer may store imported goods in a bonded warehouse.


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December 2024

 1 Questions
Question 3a
​​Explain FOUR benefits that may accrue to a country which is a member of East African Community from harmonising tariff classifications and customs procedures among East Africa Community members


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August 2024

 1 Questions
Question 4a
​​Explain the following terms as used in taxation: 

(i) Duty drawback. 

(ii) Sufferance wharf. 

(iii) Import declaration fee.


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April 2024

 1 Questions
Question 4b
​​Describe THREE ways in which the operation of bonded warehouses contributes to trade facilitation and international commerce in your country.


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December 2023

 1 Questions
Question 3a
​ ​​Explain the following terms as used in customs and excise taxes: 

(i) Transshipment. 

(ii) Ex-factory selling price. 

(iii) Prohibited goods.


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August 2023

 1 Questions
Question 5b
​​Section 17 of the Excise Act empowers the commissioner to consider an application for excise license and either grant or refuse to issue the applicant with the license. 

Identify THREE instances in which the commissioner may refuse to grant an excise license to the applicant.


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April 2023

 2 Questions
Question 3a
​​Highlight THREE benefits of the Integrated Customs Management System (ICMS) in the administration of customs taxes.


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Question 3b
​​Identify THREE activities that require a licence or registration by the commissioner before undertaking as per the excise duty Act 2015.


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December 2022

 2 Questions
Question 3a
​​Explain the term “Certificate of Origin” as used under customs and excise taxes.


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Question 4b
​​Highlight THREE benefits derived by member countries of the East African Community from use of the Single Customs Territory.


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August 2022

 1 Questions
Question 5a
​​Explain the following terms as used under the customs and excise duties: (i) Bonded warehouse. (2 marks) (ii) Duty drawback.


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April 2022

 2 Questions
Question 4b
​​Outline four instances where the Commission may suspend a license issued under the Excise Duty Act, 2015.


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Question 4a
​​Propose four ways through which the government might prevent loss of revenue from imports.


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December 2021

 1 Questions
Question 4b
​​ Citing three reasons, justify the need for introduction of integrated customs management system (iCMS) or similar system in your country.


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August 2021

 1 Questions
Question 4b
​​Explain two ways in which the Revenue Authority in your country might prevent loss of tax revenue from imports.


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May 2021

 1 Questions
Question 3b
​​Explain four grounds under which the commissioner might suspend or cancel a licence to manufacture excisable goods.


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November 2020

 2 Questions
Question 5b
​Suggest four measures that a government should put in place to prevent dumping in a country.


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Question 5a
​​Highlight two categories of goods liable for forfeiture under Customs and Excise Duty Act.



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November 2019

 1 Questions
Question 5a
​​Explain each of the following terms as used under custom taxes

(i) Clean report of findings 

(ii) Import declaration form.


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May 2019

 2 Questions
Question 3a
​​Outline four categories of goods which are subject to customs control under the Customs and Excise Act.


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Question 5a
​The Excisable Goods Management System Regulations require for affixing of excise stamps on every package of excisable goods. 

Identify two purposes of these stamps.


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November 2018

 2 Questions
Question 4a
​​Highlight two reasons why an importer is required to fill in an import declaration form.


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Question 4b
​​Morris Kwachu applied for a licence to commence manufacturing business dealing in excisable goods, The Commissioner refused to issue him with a licence.

Advise him on four grounds under which the Commissioner might refuse to issue the applicant with a licence as provided under the Excise Duty Act


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May 2018

 1 Questions
Question 5a
​​ Highlight four circumstances under which duty paid on imported goods may be refunded by the commissioner.


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November 2017

 1 Questions
Question 5a
​​Outline four activities specified under the Excise Duty Act that a person should not undertake unless the person is licensed or registered by the commissioner to undertake.



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May 2017

 2 Questions
Question 3a
​​Explain the meaning of the term "time of supply" in relation to excisable services.


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Question 3b
​​Summarise four categories of goods that are subject to customs control as provided in the East African Community Customs Management Act (EACCMA) or equivalent legislation.


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November 2016

 1 Questions
Question 5b
​​Outline four recent measures introduced by the government of your country to prevent dumping of imported goods into your country.


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November 2015

 1 Questions
Question 4a
​​ Identify four areas designated as customs areas under the Customs and Excise Act.


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May 2015

 1 Questions
Question 2a
​ ​​The member states of East African Customs Union have faced certain challenges in their integration. Citing relevant example, evaluate four such challenges.


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