The Ministry Of Interior Introduces Expatriate Employment Levy – Employee Benefits & Compensation

In a bid to drive economic growth and foster local workforce
development, the Ministry of Interior (the “Ministry”)
launched the Expatriate Employment Levy (the “Levy”) on
Tuesday, 27th February 2024.¹ This significant move represents a
pivotal moment in the country’s ongoing efforts to achieve
economic balance and enhance the development of local talents, as
well as, increase the tax net. The initiative also aims to narrow
the wage disparities between expatriates and Nigerian employees.²

The key objectives of the Levy include promoting skill transfer
and knowledge exchange, ensuring a balance between economic
advancement and social well-being, strengthening collaboration
between the public and private sectors, and addressing demographic
changes.³

The following are important points to note:

1. The Levy is applicable to non-citizens employed within
   Nigeria.




2. The Levy covers employers in businesses, such as: multinational
   corporations, SMEs and other entities engaged in expatriate
   talents.




3. Certain employment circumstance may warrant an application of
   the Levy Status, such as the issuance of work/residence permits,
   the renewal of employment contracts, or the change of an expatriate
   status.




4. The Levy aims at encouraging companies to prioritise Nigerian
   citizens in their hiring.




5. The Immigration Service is charged with the responsibility of
   enforcing the Levy.




6. An expatriate employed for a duration of not less than 183 days
   within a year is liable to pay the Levy on an annual basis.




7. There will be sanctions, if companies fail, refuse or neglect
   to comply.




8. The Levy will be computed at $15,000 for every expatriate on
   director level and $10,000 for those on other levels.

However, the Ministry of Interior announced the temporary
suspension of the Levy,⁴ following a meeting held on the
8^th of March 2024 with the Nigerian Association of
Chambers of Commerce, Industry, Mines, and Agriculture
(“NACCIMA”). The Ministry announced that the purpose of
the temporary suspension was to consult further with stakeholders
in the industry.⁵

The Employment Expatriate Levy Handbook is available here.

Footnotes

1. See,
The Cable Newspaper: “Expatriate employment levy: Matters
arising” available at https://www.thecable.ng/expatriate-employment-levy-matters-arising
accessed April 2^nd 2024.

2.
Ibid.

3.
Ibid.

4. See,
BBC News “Nigeria pauses controversial expatriate employment
levy” available at https://www.bbc.com/news/world-africa-68521394
accessed 12^th March 2024.

5.
Ibid.

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