Former Prime Minister and Fiji Labour Party Leader Mahendra Chaudhry has criticized the Coalition Government for deviating from its commitment to address the escalating cost of living, which he identifies as a pressing issue for the citizens of Fiji. Speaking at the Party’s annual delegates conference in Nadi, Chaudhry pointed to the Coalition’s decision to implement a 15 percent value-added tax (VAT) on most goods and services in its first budget in July 2023. This move, he claims, has led to a significant rise in the cost of living and inflation.
Chaudhry accused Finance Minister Biman Prasad of an “arrogant” approach towards introducing the VAT, which he viewed as an austerity measure to tackle a substantial national debt of $10 billion. He argued that the Minister disregarded other, more equitable options for revenue generation and failed to acknowledge the adverse effects of the VAT increase on the economically vulnerable sections of society.
The former Prime Minister reiterated that the Fiji Labour Party has historically opposed VAT, labeling it a regressive tax that places a heavier burden on the poor, shifting responsibilities away from higher-income individuals. He referenced a 1999 initiative by the Labour-led government to lower VAT on essential food items as a means to support those in need, calling the current VAT rate unsustainable and advocating for a reduction to at least 9 percent.
Chaudhry highlighted that even Prime Minister Rabuka had earlier acknowledged the VAT rate was too high, yet he succumbed to the pressures from his Finance Minister and allies. This decision, according to Chaudhry, was a betrayal of the government’s promises to the electorate.
He further criticized the government’s failure to provide adequate relief to low-income workers following the VAT hike, describing the situation as a disregard for the struggles of ordinary citizens. He expressed particular frustration over the government’s simultaneous actions to grant tax exemptions to Fiji Water and to increase the salaries of Members of Parliament, which he deemed hypocritical amid austerity measures directed at the public.
Chaudhry also raised concerns about potential conflicts of interest regarding Richard Naidu, a senior partner at a law firm and an ally of the Finance Minister, who he claims played a questionable role in the negotiations leading to the tax holiday for Fiji Water. He called for an independent investigation into these matters, demanding accountability for what he termed as a “scam.”
The former Prime Minister voiced his dissatisfaction with recent government appointments, arguing that various actions undertaken by the administration reflect a troubling lack of ethics and integrity, which undermines public confidence in leadership. He pointed to the appointment of Ratu Naiqama Lalabalavu as President, along with questionable judicial appointments, illustrating a broader sense of neglect towards public opinion and due process.
In essence, Chaudhry’s remarks encapsulate a call for the government to reconsider its fiscal policies and approach to governance, emphasizing a need for transparency, fairness, and responsiveness to the needs of the populace.
While the situation appears challenging, it also opens up possibilities for public engagement and dialogue on fiscal reform and responsible governance practices. The increasing scrutiny of government decisions might push for more inclusive policymaking in the future.
Summary: Mahendra Chaudhry, former Prime Minister of Fiji, criticized the Coalition Government for raising VAT to 15%, which he claims worsened the cost of living and inflation, betraying election promises. He called for an independent investigation into government actions favoring Fiji Water and highlighted ethical concerns surrounding recent appointments and policies. Chaudhry advocates for reducing VAT and improving conditions for low-income workers.
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