The Nigeria Employers’ Consultative Association (NECA) has issued a warning, expressing concerns that the expatriate employment levy introduced by the Ministry of Interior could potentially discourage investment in the country.
Additionally, the association criticized the levy, arguing that certain regulations must be established before such a tax could be imposed.
In a statement released on Sunday, NECA highlighted its concerns regarding the introduction of the Expatriate Employment Handbook by the Federal Ministry of Interior. The association expressed apprehension that the newly proposed levy, intended to facilitate skills transfer in Nigeria, could potentially undermine the Federal Government’s ongoing fiscal and monetary reforms if implemented.
The Director-General of NECA, Adewale-Smatt Oyerinde said, “It will also serve as a disincentive to Foreign Direct Investment among many other unintended negative consequences. The levy of between $10,000 to $15,000 on employers that employ expatriates when Nigeria is actively seeking FDI is not only exploitative and extortionist but also a contradiction that cannot be explained.”
“While we support the Federal Government’s objective of developing the local workforce, we have been at the forefront of promoting skills transfer, technical skills development, and employment generation.
He added, “However, the recently launched initiative of the Ministry of Interior has the potential to create more fundamental economic and socio-labour distortions.“
“The imposition of US$15,000 and US$10,000 on organisations that employ expatriates at a time when businesses are shutting down and leaving the country in droves is worrisome. Recent results of many businesses have shown massive losses, a situation that could potentially increase the level of unemployment with dire socio-economic consequences.”
Expressing the organized business community’s apprehension regarding the legality and suitability of the levy, Oyerinde remarked, “We are concerned about the legality and appropriateness of the Expatriate Employment Levy and its potential impact on the economy. The provisions of a Handbook cannot supersede the clear provisions of existing laws in Nigeria, particularly the 1999 Constitution of the Federal Republic of Nigeria, Immigration Act, and the Local Content Act, among others.”
According to him, the Ministry of Interior and indeed, the government cannot impose a tax or levy without appropriate legislation.
Connect with us on our socials: