On Thursday, a Federal High Court in Abuja issued a directive requiring Dr. Olubunmi Tunji-Ojo, the Minister of Interior, and Mr. Lateef Fagbemi, the Attorney-General of the Federation (AGF), to appear before the court within three days. The court’s order was in response to a request by the Incorporated Trustees of New Kosol Welfare Initiative, the plaintiff in the case, seeking to prevent the implementation of the newly proposed expatriate taxation system, known as the Expatriate Employment Levy (EEL).
Justice Inyang Ekwo, presiding over the matter, instructed that the Interior Minister and AGF be served with the motion for them to explain why the court should not halt the enforcement of the EEL. This ruling followed a motion filed by the plaintiff’s legal counsel, Patrick Peter, in the case marked FHC/ABJ/CD/1780/2024.
The motion argued that the new taxation policy, which was unveiled by the Federal Government on February 27, 2024, was detrimental to the nation’s economic wellbeing. The plaintiff, represented by Programme Implementation Coordinator Raphael Ezeh, claimed that the EEL would impose significant financial burdens on companies employing foreign expatriates. Specifically, the policy mandates that companies pay an annual tax of $15,000 (about 23 million naira) for expatriates at director level, and $10,000 (approximately 16 million naira) for those in non-director positions.
Additionally, the policy includes harsh penalties for non-compliance, including heavy fines and prison sentences. For instance, failure to file or submit inaccurate EEL information could result in a fine of 3 million naira, while incomplete reporting or failure to register expatriates on time could also incur significant penalties. Ezeh described the new policy as a “chokehold” on the economy and argued that it contradicted the Nigerian Constitution, which mandates that both the executive and legislative branches collaborate on tax legislation.
The plaintiff also claimed that the Interior Minister was poised to begin enforcing the new tax regime imminently, which, if allowed to proceed, could undermine the nation’s economic stability. Consequently, the court was urged to issue an injunction preventing the implementation of the EEL until the case could be fully heard.
In response, Justice Ekwo instructed that the Minister and AGF be notified of the application and ordered them to appear before the court on January 16 to explain why the injunction should not be granted. The court’s decision came after the Federal Ministry of Interior had earlier suspended the rollout of the EEL in 2024 to allow for further consultations with stakeholders such as the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA).