High Court Rules in Favour of Tile & Carpet Centre in KRA Green Tariff Dispute

A Nairobi High Court ruling has delivered a significant win for Tile & Carpet Centre Ltd in its dispute with the Kenya Revenue Authority over green technology imports. Justice F.G. Mugambi dismissed KRA’s attempt to suspend a Tax Appeals Tribunal decision classifying imported heat pumps under a zero-duty tariff code.

The case, Commissioner of Customs & Border Control versus Tile & Carpet Centre Ltd, centred on the Aertech All-in-One heat pump. The tribunal had ruled in March 2026 that the equipment qualifies for zero-percent import duty as green energy technology.

KRA sought to tax the equipment under a higher-duty classification. The court, however, found the authority’s arguments unconvincing and allowed the zero-duty status to remain in place for now.

Justice Mugambi noted that KRA’s projections of substantial revenue losses were speculative. He pointed out that Tile & Carpet Centre is a going concern fully capable of settling any back-taxes if the authority eventually wins on appeal.

The court also rejected the notion that the ruling would automatically create a blanket precedent for the entire importing sector. This decision is a stay application, not the final verdict, as KRA’s substantive appeal is still pending.

For developers, contractors and suppliers like Tile & Carpet Centre pushing energy-efficient building solutions, the outcome provides breathing room. Heat pumps and similar systems are increasingly important for sustainable construction and retrofits in Nairobi and beyond.

The ruling reinforces a favourable tax environment for green technology imports in the short term. It gives importers greater certainty while the underlying tariff classification question is fully resolved through the appeal process.

Tile & Carpet Centre welcomed the decision as it ensures business continuity during the ongoing legal proceedings. The company supplies finishes and hardware for numerous construction projects across Kenya.

The tribunal’s original decision recognised the heat pump as qualifying green energy technology. Maintaining that classification supports efforts to promote sustainable development and reduce carbon emissions in the built environment.

KRA had argued that upholding the ruling could open the floodgates for similar claims by other importers. Justice Mugambi required more concrete evidence before granting a suspension that would disrupt operations.

This case highlights ongoing tensions between revenue collection priorities and incentives for green technologies in construction. Industry stakeholders will monitor the full appeal for its potential impact on future imports of energy-efficient equipment.

Construction Today will continue tracking this matter and similar cases affecting sustainable construction practices in Kenya. The final outcome could influence how green building materials are classified and taxed at the border going forward.