To Improve Investor Confidence and Economic Growth: FG Suspends Implementation of Expatriate Employment Levy.
In a significant move, the Nigerian government has halted the enforcement of the expatriate employment levy, a $10,000-$15,000 charge for businesses employing foreign workers. The decision was confirmed in a statement released on the 8th day of March by Dele Kelvin Oye, President of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA).
The statement released by NACCIMA read, “The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture, in collaboration with key stakeholders, announces a temporary step down of the recently enacted Expatriate Employment Levy by the Federal Ministry of Interior, as administered by the Nigerian Immigration Service.”
The suspension of the levy came after a successful Trade and Investment outreach led by President Bola Ahmed Tinubu in Qatar, which was followed by a productive meeting with the Minister of Industry, Trade and Investment, Doris Aniete, and the Minister of Interior, Olubunmi Tunji-Ojo. The meeting involved various stakeholders, including the president of NACCIMA, Dele Oye, the President of the Petroleum Technology Association, the President of the Special Economic Zones Association, the Director General of The Nigerian Turkiye Business Council, the head of the European Union Trade delegation, the NACCIMA Chair of Digital Trade Group, and representatives of the National Association of Small and Medium Scale Enterprises (NASME).
The expatriate employment levy was introduced on February 27, 2024, through the Expatriates Employment Levy (EEL) Handbook. It mandated employers who hire expatriate workers in Nigeria to pay a levy of $10,000 for each expatriate worker and $15,000 for a director.
However, the implementation of the levy faced significant backlash from private sector groups, who expressed concerns about its impact on Foreign Direct Investment (FDI) and the stability of the Nigerian currency, the naira.
Recognizing the concerns raised by stakeholders, NACCIMA, in collaboration with other key players, announced the temporary suspension of the levy. This decision allows for further consultations with NACCIMA and other vital stakeholders, and a review committee will be constituted to assess the implications and effectiveness of the levy.
NACCIMA emphasized that the reversal of the policy is intended to provide reassurance to current and prospective investors and urged them to continue their business activities and investment plans in Nigeria with confidence. The association highlighted that the assurances provided by the ministers during the negotiations have reinforced the federal government’s commitment to enhancing the investment landscape and supporting economic growth.
Pausing the expatriate employment fee is likely to address worries among businesses and draw in more foreign investment in Nigeria. This action shows that the government is willing to listen to stakeholders’ concerns and have productive discussions to foster a business-friendly environment.
Moving forward, the review committee will play a crucial role in assessing the levy’s impact, taking into account the perspectives of various stakeholders, including the private sector, and making recommendations for potential modifications or alternatives that align with the government’s objectives while addressing the concerns raised.
The government has paused the new tax for foreign workers to keep investors happy and grow the economy. This means Nigeria will welcome investment from both its people and people from other countries, which will help the country improve and thrive.
