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Navigating the New Expatriate Employment Levy in Nigeria: Implications and Concerns


The Federal Government of Nigeria, under the leadership of President Bola Tinubu, has recently introduced the Expatriate Employment Levy (EEL) through the Nigerian Immigration Service. Launched on February 27, 2024, and effective as of March 15, 2024, the EEL imposes a mandatory levy on companies engaging expatriate workers in Nigeria. This levy amounts to $15,000 per annum for each expatriate director and $10,000 per annum for other expatriate positions.


Objectives of the Levy

The primary objectives of the EEL are varied, aiming to:

  • Promote knowledge and skill transfer from expatriates to local employees.
  • Provide a balance between economic growth and the social welfare of Nigerians.
  • Enhance collaboration between the public and private sectors.
  • Address demographic shifts.

Targets and Exemptions

The levy applies to businesses of all sizes operating in Nigeria, including multinational corporations, small and medium-sized enterprises (SMEs), and other entities engaging expatriate talents. However, expatriates accredited to Diplomatic Missions, government officials, and international agency staff are exempted from the levy. Expatriate workers under specific types of work permits, visas, or temporary residency arrangements are also exempt, along with those occupying quota positions or on temporary assignments provided they stay in Nigeria for at least 183 days within a fiscal year.


Implications and Compliance Requirements

Organizations engaging expatriate workers must be aware of the following implications and compliance requirements:

  • Payment of $15,000 per annum for every expatriate director and $10,000 per annum for any other expatriate position.
  • Maintenance of detailed records of all expatriate employees’ employment contracts, salary details, work permits, and relevant documentation.
  • Submission of the above documents to the Nigeria Immigration Service (NIS) by the end of February each year for EEL determination.
  • Timely notification to the NIS of any changes in expatriate employment circumstances that might affect EEL calculation.
  • Penalties amounting to N3 million for various offenses such as failure to file the EEL return on time, failure to register a new expatriate employee promptly, submitting forged documents for EEL calculation, and failing to renew EEL before expiration.

Concerns and Critiques

While the introduction of the Expatriate Employment Levy (EEL) in Nigeria has noble intentions, there are noteworthy concerns and critiques that merit further examination. One primary concern revolves around the timing of the levy’s implementation. The hurried nature of introducing such a significant policy without thorough consultation and analysis raises questions about its effectiveness and potential unintended consequences.

Another critical concern is the long-term impact on foreign direct investment (FDI). Companies engaging technical experts and skilled expatriates may find the EEL burdensome and restrictive, potentially deterring them from making substantial investments in Nigeria. This could hinder the country’s ability to attract top talent and expertise from overseas, impacting innovation and economic growth in the long run.

Additionally, the lack of conclusive recommendations from the Presidential Committee on Fiscal Policy & Tax Reforms adds another layer of uncertainty. The absence of a comprehensive review and analysis of the broader tax landscape and potential reforms raises doubts about the EEL’s alignment with broader fiscal policies and economic goals.

There are also practical concerns related to compliance and implementation. Organizations, especially smaller businesses and start-ups, may struggle to navigate the requirements of the EEL, leading to inadvertent violations and penalties. The administrative burden of maintaining detailed records, submitting documentation to the authorities, and staying updated on changing regulations could strain businesses, particularly those with limited resources and expertise in tax compliance.

Moreover, the potential for unintended consequences on local employment should not be overlooked. While the EEL aims to promote knowledge transfer from expatriates to local employees, there is a risk that companies may reduce expatriate hires or shift operations in response to the levy. This could inadvertently limit opportunities for local workers to learn from international experts and gain valuable skills and knowledge.



In conclusion, while the government’s efforts to enhance revenue generation and promote local talent development through the EEL are commendable, a more measured and consultative approach is essential to address the legitimate concerns and critiques. Striking a balance between revenue objectives and FDI attractiveness, ensuring alignment with broader fiscal policies, and providing adequate support for businesses to comply with the levy requirements will be key to mitigating potential drawbacks and maximizing the benefits of this initiative.


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