Nigeria has recently implemented a new mandatory annual levy in an effort to encourage foreign organizations employing expatriate workers to hire more Nigerian employees. Under the new legislation, companies will be required to pay a levy of $15,000 (£12,000) for a director and $10,000 for other expatriate workers.
This move comes as the country grapples with its worst economic crisis in a generation, leading to widespread hardships and discontent. The Nigerian government hopes that by imposing this levy, it can bridge the wage gap between expatriates and Nigerian employees while increasing employment opportunities for qualified Nigerians in foreign companies operating within the country.
However, President Bola Tinubu has cautioned against using the levy as a tool to frustrate potential investors. Speaking at the launch of the Expatriate Employment Levy (EEL) handbook on Tuesday, President Tinubu emphasized the government’s commitment to improving revenue and promoting the indigenization of the workforce.
“The goal is to close wage gaps between expatriates and the Nigerian labor force while increasing employment opportunities for qualified Nigerians in foreign companies in the country,” President Tinubu stated. He also expressed his expectation for clear implementation of the program to achieve its intended objectives.
It should be noted that diplomatic mission staff and government officials are exempt from this levy. However, for employees who work for at least 183 days in a year, failure to comply with the new legislation could result in penalties, including fines of up to three years and imprisonment for up to five years.
To ensure compliance, the Nigerian Immigration Service will enforce the levy. Interior Minister Olubunmi Tunji-Oj has revealed that the implementation will be based on a public-private partnership model involving the government, the immigration service, and a private firm.
The introduction of this mandatory levy is a significant step in Nigeria’s ongoing efforts to boost its economy and tackle widespread unemployment. Amidst the economic crisis, demonstrations by labor unions and government workers took place to voice their concerns over the hardships faced by Nigerians.
Acknowledging the challenging period, President Tinubu assured the population that efforts were being made to improve the country’s financial situation and stimulate economic growth.
Nigeria’s government aims to strike a balance between fostering foreign investment and prioritizing employment opportunities for Nigerian citizens. The success of this levy will depend on its fair implementation and its ability to attract foreign companies to invest in Nigeria while also prioritizing the local workforce.
As the levy comes into effect, it remains to be seen how it will impact the country’s employment landscape and overall economic recovery. The Nigerian government will need to ensure that its implementation remains transparent and does not hinder potential investors.
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