Expatriate Employment Levy Could Deter Foreign Investment, Says NECA DG
LAGOS/Nigeria: The Nigeria Employers’ Consultative Association (NECA) has expressed significant concerns over the potential ramifications of the Expatriate Employment Levy (EEL) policy, warning that its implementation could serve as a disincentive to Foreign Direct Investment (FDI).
NECA’s Director-General, Mr. Wale Oyerinde, highlighted the adverse effects of the EEL policy, stating that it could impede the government’s ongoing fiscal and monetary reforms, among other negative consequences. He emphasized that a reciprocal implementation of a similar policy by other nations could have dire consequences for Nigerians working as expatriates abroad.
The EEL, inaugurated by President Bola Tinubu to address wage gaps between expatriates and the Nigerian labor force, mandates firms to pay levies for hiring expatriates and provides guidelines on the employment of Nigerians in foreign-owned companies. However, Oyerinde cautioned that the policy should not hinder foreign investment, as stated by President Tinubu.
“While we absolutely support the government’s objective of developing the local workforce, we have, in fact, been at the forefront of promoting skills transfer, technical skills development, and employment generation,” Oyerinde affirmed. “However, the recently launched initiative of the Ministry of Interior has the potential to create more fundamental economic and socio-labor distortions.”
Expressing concern over the legality and appropriateness of the levy, Oyerinde stressed that any imposition of tax or levy must be backed by an Act of the National Assembly, as per Section 59 of the Nigerian Constitution. He urged the government to strengthen existing regulatory institutions responsible for managing expatriate employment rather than imposing additional levies, ensuring a more responsive and accountable regulatory framework.
Oyerinde advocated for collaborative efforts between the government and the private sector to explore alternative revenue streams and promote wealth creation through dialogue and stakeholder engagement. He emphasized the importance of pursuing strategies that foster a conducive investment climate without imposing undue burdens on businesses.
In conclusion, Oyerinde asserted, “Collaboration between the private sector and government is essential to finding equitable solutions that promote economic interests and support sustainable business growth.”
