Former Prime Minister and leader of the Fiji Labour Party, Mahendra Chaudhry, has voiced serious concerns regarding the Coalition Government’s apparent reversal on its promises to alleviate the rising cost of living, which he identifies as a primary source of hardship for the citizens of Fiji. Addressing the annual delegates conference in Nadi, Chaudhry criticized the Coalition’s decision to implement a 15 percent VAT on nearly all goods and services in their first budget in July 2023, an action he claims has led to increased living costs and inflation.
Chaudhry accused Finance Minister Biman Prasad of demonstrating arrogance in implementing this policy, describing it as an austerity measure necessary to address the country’s substantial $10 billion national debt. He argued that alternatives to raising VAT were not properly explored, highlighting the detrimental impacts this tax hike would have on the economically vulnerable populations. The Labour Party has historically opposed VAT, labeling it as a regressive tax that disproportionately burdens those with lower incomes.
Reflecting on past decisions, Chaudhry recalled how the Labour-led government in 1999 reduced VAT on essential food items to aid the needy. He urged that the current VAT rate of 15 percent is excessive and should be decreased to at least 9 percent. Notably, even Prime Minister Rabuka had previously acknowledged that the elevated VAT was excessive but ultimately capitulated to pressure from Prasad and Richard Naidu, chair of the Fiscal Review Committee, leading to increased taxation instead of providing relief.
Further fueling public discontent, Chaudhry condemned the Coalition’s choice to grant tax-free privileges to Fiji Water while imposing higher taxes on local businesses. He questioned the rationale behind giving foreign entities favorable treatment while local workers and businesses suffer from austerity measures, suggesting that such actions demonstrate disregard for the average citizen.
Chaudhry has called for an independent investigation into this issue, given the perceived conflicts of interest involving the Finance Minister and key figures in the legal and business communities, particularly regarding Fiji Water’s tax holiday. He also raised concerns about the significant increases in the pay for Members of Parliament, contrasting this with the minimal bump in the national minimum wage, signaling a lack of commitment to the common good.
Chaudhry concluded with reflections on perceived ethical lapses among Coalition ministers and their apparent disregard for public sentiments regarding appointments to key governmental positions, suggesting that these actions undermine the rule of law and public trust.
With these developments, there remains hope that a resurgence of public discourse might pressure the government to reconsider its fiscal policies and commitment to the welfare of its citizens. This situation could serve as a pivotal moment for civic engagement and potential reform in the political landscape of Fiji.
In summary, Chaudhry’s remarks highlight significant public dissatisfaction with the current government’s financial strategies, pointing out inconsistencies in their policy implementations and advocating for the needs of the vulnerable populations in Fiji.
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