Traders are withholding funds to protest poor state of markets.
Two county governments could face a revenue crunch after traders refused to pay taxes over poor service delivery.
Officials from Siaya and Homa Bay counties were on Saturday racing to collect unpaid taxes in some of the markets amid fear that they could be losing millions of shillings.
In Homa Bay, Kojwach Ward Representative Joan Ogada and businessman Paul Sidhe led traders at the usually busy Ringa market in Kabondo Kasipul Constituency, who stopped paying taxes on July 15, in a demonstration over poor sanitation and infrastructure.
“The market is in pathetic condition and we lack access roads for efficient transport of goods,” said Mr Sidhe.
Ms Ogada accused the county of ignoring their 100-day notice to improve market conditions, saying the boycott would continue until rehabilitation works were completed.
Last Thursday, Trade minister Carelus Ademba launched the construction of toilets, graveling of the Ringa Ring Road and rehabilitation of the market.
Two other MCAs - James Ochieng’ (Kabondo East) and Oscar Abote (South Kabuoch) - also threatened to mobilise traders in their wards.
“We want our markets and roads improved, or else we will not pay taxes,” said Abote.
Two months ago, Finance minister Nicholas Koriko said they had been collecting Sh17 million each month since 2013, but revenue had declined to Sh10 million.
Koriko also banned the use of handwritten receipts to boost revenue collection.
In Siaya, Director of Revenue Domnick Obel warned that leaders who told traders not to remit taxes would face the law.
Mr Obel made reference to a law enacted by the MCAs, saying it warned against preventing traders from paying taxes.
“We have the County Finance Act that is operational, and legal action can be taken against whoever refuses to pay tax or hinders someone from paying,” he said
On Friday, MCAs Susan Okwiri (West Gem) and David Audi (South Gem) told traders from Ngiya and Akala markets to withhold taxes.
“Why should the traders pay taxes yet they stay and work in dirty markets? Do not give the county even a single cent until they work on proper sanitation of these markets. It is not fair that they collect from you and fail in their service delivery mandate,” said Mr Audi.
Ms Okwiri claimed the traders had turned toilets into banana-ripening stores, forcing men and women to share one ablution block. “It is embarrassing to have females and males sharing the same washroom. It is unhealthy, especially for women. The county public health department has failed in its mandate. We have raised concerns since last year,” said Okwiri.
Obel confirmed that garbage had not been collected from the market for days after tractors broke down.