The tax holiday provided by the Short Life Investment Package (SLIP) will now also be available for investors who purchase existing hotels and resorts and undertake extensions and refurbishments exceeding $50 million. This announcement comes from Deputy Prime Minister and Finance Minister Prof Biman Prasad during his 2024-2025 National Budget speech, and it is aimed to support significant investments such as the Wananavu Resort and Crowne Plaza.
Prasad encourages investors to seize this opportunity, especially considering the current need for more capacity in the tourism sector. He also concluded that the standard allowance set for hotel renovations and extensions would decrease from 50% to 25%, returning to the levels that existed prior to the pandemic.
In a bid to support construction and bring down building expenses, the tax on prefabricated buildings will see a slash from 32% to 5%, whereas steel structures or iron articles will remain at 5%. Alongside, the departure tax will see a rise from $140 to $170, effective from August 1, 2024, and return to the pre-pandemic rate of $200, effective from August 1, 2025.
In addition, the transit hours for departure tax exemption will be reduced from 96 hours to 48 hours, or two days, effective from August 1, 2024. Initially, the transit hours for departure tax exemption was set at 12 hours, which was later increased to 96 hours.
The Ministry of Tourism and Civil Aviation has been allocated $68.8 million in the 2024-25 National Budget, which includes a $44 million grant for Tourism Fiji and $13.6 million for the Fiji Tourism Development Program on Vanua Levu. Prasad has also announced plans to set up a Tourism MSME (Micro, Small and Medium-sized Enterprises) pilot fund. This scheme is aimed at supporting and empowering tourism MSMEs by providing rural communities with financial assistance up to $15,000. This fund will facilitate investment, create decent employment opportunities, and promote sustainable tourism activities.