Former Prime Minister and Leader of the Fiji Labour Party, Mahendra Chaudhry, has accused the current Coalition Government of reversing its commitment to reduce the rising cost of living, which he identifies as a major cause of hardship for citizens. During the annual delegates conference in Nadi, Chaudhry criticized the Coalition’s first Budget released in July 2023, which implemented a 15 percent value-added tax (VAT) on most goods and services, exacerbating inflation and living costs.
Chaudhry expressed discontent with the Finance Minister’s handling of the VAT increase, labeling it an austerity measure intended to address a substantial national debt of $10 billion. He argued that the government dismissed viable alternatives and ignored the severe impact on the most vulnerable population segments. The Labour Party had previously warned that such a VAT hike would escalate inflation.
Historically, the Labour Party has opposed VAT, viewing it as a regressive tax that disproportionately affects low-income individuals. Chaudhry recounted that the Labour-led government in 1999 had initiated a VAT reduction on staple foods to alleviate financial strains on the needy.
He noted that even Prime Minister Rabuka initially conceded that a 15 percent VAT was excessive, but later succumbed to pressures from Finance Minister Prasad and his ally, Richard Naidu. Chaudhry condemned this move as a betrayal of the Coalition’s electoral promises. He highlighted that despite the VAT increase, low-income workers received no substantial relief.
Chaudhry pointed out that the situation was further aggravated by the Coalition’s decision to grant tax holidays to Fiji Water while simultaneously increasing MPs’ salaries. This disparity, he argued, undermined the government’s austerity narrative and highlighted a lack of sensitivity to the struggles of local workers and businesses.
The former Prime Minister called for an independent investigation into what he termed a “scam,” suggesting that there may be conflicts of interest involving Naidu and Prasad in facilitating favorable tax conditions for Fiji Water. He criticized the significant pay increases for Members of Parliament alongside minimal raises in the national minimum wage, questioning the ethics and integrity of the ministers.
Chaudhry also expressed concern over the government’s apparent disregard for public opinion in critical appointments, such as that of Ratu Naiqama Lalabalavu as President and various judiciary roles. He condemned these actions as unconstitutional and a threat to the rule of law, noting instances where the courts had intervened due to public outcry.
This situation presents a compelling opportunity for potential reform as it sheds light on the need for a more equitable approach to taxation and governance that truly addresses the concerns of the citizens. Engaging in productive dialogue to address these grievances could lead to improvements in public trust and economic stability.
In summary, Chaudhry’s remarks underline significant frustrations with the Coalition Government’s financial policies and ethical standards, raising pressing questions about governance in Fiji. While the current context appears challenging, the situation also opens the door for conversations around accountability and reform, which, if embraced, could lead to a more favorable environment for the Fijian people moving forward.
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