…as Soyede queries the rationale behind the move by the government to increase the levy
The Manufacturers Association of Nigeria (MAN), has commended the Federal Government of Nigeria for its decision to halt the implementation of the Expatriate Employment Levy.
Segun Ajayi-Kadir, mni, Director General/Chief Executive Officer of the Manufacturers Association of Nigeria (MAN) said: “MAN had earlier made a representation to Mr President and copied to the Ministers of Finance and Coordinating Minister of the Economy; Industry, Trade and Investment; and Interior, to discontinue the enforcement of the levy and followed up with the aforementioned Ministers.
Ajayi-Kadir also added that MAN deeply appreciates the swift intervention of the Minister of Finance and Coordinating Minister of the Economy.
We acknowledge the important role of the Minister of Industry, Trade and Investment. We equally recognize the support of the Chairman of the Presidential Committee on Fiscal Policy and Tax Reform.
Quite importantly, we commend the Minister of Interior for doing the needful in the interest of domestic and foreign private sector investors in Nigeria. There is no doubt that the anxiety that enveloped the business community following the introduction of the levy has abated.
Also, the international business community, particularly those with whom we have signed trade agreements, would also be reassured of our commitment to the creation of a congenial business environment.
While reacting to this development, Bajide Soyede, a former managing director of Warri Refinery, stated that the Expatriate Employment Levy should be abolished. It is just a lazy excuse for not screening and evaluating properly whether expatriates coming to work in the country are necessary or not. Otherwise, you cannot issue an EO purporting to reduce the cost of doing business, and then levying a ridiculous tax on the people coming to the business.
Secondly, we are complaining about too many taxes. Why add another outrageous one? If an expatriate is allowed in to work, it must be he or she has a value to add. We should tax the value, and not the presence of the expatriate, which is just an instrumentality of adding value.
According to a BBC report, Nigeria has paused a controversial annual levy that would require businesses employing expatriates to pay $15,000 (£12,000) for a director and $10,000 (£8,000) for other workers.
President Bola Tinubu imposed the tax over a week ago, but it was met with widespread condemnation.
The Ministry of Interior said on X the levy would be paused for “dialogue among stakeholders”.
It comes after a meeting was held to discuss the levy on Friday in Abuja.
The Ministry of Interior said the tax was intended to “discourage abuse” of the expatriate quota.
It said it hoped the levy would create “employment opportunities for Nigerians while closing wage gaps between expatriates and local workers”.
Dele Kelvin Oye, national president of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), welcomed the pause.
He praised the government for considering the implications the levy could bring on Nigeria’s business community.
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“This is indicative of their commitment to creating an inviting atmosphere for both local and international investors,” he said in a statement.
When the Expatriate Employment Levy (EEL) was imposed many organisations hit back against it.
The Nigeria Employers’ Consultative Association (Neca) raised alarm over the policy, especially as Nigeria faces its worst economic crisis in a generation.
In a statement shared on X, Neca called the policy “worrisome”. It expressed fears the levy could “potentially increase the level of unemployment with dire socio-economic consequences”.
Manufacturers Association of Nigeria (Man) called the policy “punitive” and a “punishment” for investors.
“The policy will surely undermine the administration’s determination to position Nigeria as an attractive global investment destination,” it said on X.
There are more than 150,000 expatriates in Nigeria, according to local media citing data from the interior ministry.
They mostly work in the oil and gas, construction, telecommunication and hospitality sectors.
Nigeria is one of Africa’s biggest oil producers. Its oil and gas exports account for 90% of foreign exchange earnings, according to the International Monetary Fund.
It currently costs companies in Nigeria $2,000 a year to obtain a residency permit for each foreign employee.
Mr Tinubu acknowledged Nigerians were going through a difficult period.
Nigerians are facing increased food, transport and commodity prices. This is because of the fall of the naira – which has caused a spike in foreign exchange rates and driven up inflation.
He said efforts were being made to improve the country’s finances and grow the economy.
