Manufacturers Association of Nigeria Condemns Expatriate Employment Levy, Citing Economic Impact

The Manufacturers Association of Nigeria (MAN) has strongly criticized the recently introduced Expatriate Employment Levy (EEL) by the Federal Government, citing its detrimental effects on the manufacturing sector and the broader economy. According to MAN, the levy contradicts President Bola Tinubu’s Renewed Hope Agenda and his Fiscal Policy and Tax Reform initiative, exacerbating the challenges faced by manufacturers amidst the economic downturn.

In a statement, MAN highlighted the adverse consequences of the EEL, including increased cost of doing business, which could further strain an already distressed manufacturing sector. The association revealed that 767 manufacturers shut down operations in 2023, with an additional 335 becoming distressed, reflecting the severity of the economic challenges.

MAN expressed concern over declining capacity utilization, rising interest rates, scarcity of forex for importing raw materials, and a growing inventory of unsold finished products, all contributing to a grim economic outlook. Moreover, the introduction of the levy is viewed as contradictory to international trade agreements, potentially undermining regional integration efforts and portraying Nigeria negatively among her peers.

The association emphasized the need for the Federal Government to reconsider the implementation of the EEL, urging President Tinubu to direct its discontinuation. MAN warned that failure to reverse the levy could result in legal challenges and distract the government from addressing the current economic crisis effectively.

Meanwhile, the EEL, aimed at bridging wage gaps between expatriates and Nigerian workers, has drawn criticism from various sectors, including the Lagos Chamber of Commerce and Industry and the Centre for the Promotion of Private Enterprise. Concerns have been raised about its impact on foreign investments and the perception of Nigeria’s business environment, potentially deterring foreign companies and triggering retaliatory measures from other countries.