Nigerian Employers Consultative Association(NECA) Warns Ministry’s Expatriate Employment Levy May Deter Investment

The Nigeria Employers’ Consultative Association (NECA) has issued a cautionary statement regarding the Ministry of Interior’s proposed expatriate employment levy.

They expressed concerns that it could discourage investment in the country.

NECA criticized the levy, highlighting the necessity for proper regulations before its implementation. According to NECA, the levy, ranging between $10,000 to $15,000 on employers hiring expatriates, might hinder the Federal Government’s ongoing fiscal and monetary reforms if enforced.

Adewale-Smatt Oyerinde, the Director-General of NECA, stated, “It will also serve as a disincentive to Foreign Direct Investment among many other unintended negative consequences.” NECA emphasized its support for the development of the local workforce but argued that the levy could lead to economic and socio-labour distortions.

NECA raised concerns about the legality of the levy, stating that any imposition of tax or levy must be supported by legislation, as per Section 59 of the Nigerian Constitution.

Oyerinde urged the government to strengthen existing regulatory institutions responsible for managing expatriate employment instead of introducing additional levies.

He emphasized the importance of collaborative efforts between the government and the private sector to promote economic interests and sustainable business growth.

NECA acknowledged the government’s objectives but stressed the importance of implementing strategies that foster a favourable investment climate without excessively burdening businesses.

Back Story

REPORT AFRIQUE in a report filed late February revealed the Expatriate Employment Levy (EEL) unveiled by President Tinubu, marking a significant step towards bolstering Nigeria’s workforce and reducing wage disparities between Nigerians and expatriates.

The EEL initiative according to the President aims to foster skill retention, promote technology domestication, and create a more balanced employment landscape by encouraging the hiring of qualified Nigerians in foreign companies operating within the country.

Adewale -Smatt Oyerinde, NECA Director General