Fiji Labour Party leader Mahendra Chaudhry has expressed strong opposition to the current 15 percent value-added tax (VAT), asserting that it is excessively high. During the FLP Annual Delegate Conference held in Nadi, Chaudhry called for a reduction of the VAT to a more manageable 9 percent, the rate prior to the increase.
Chaudhry stated that the current VAT is not sustainable and has negatively impacted the purchasing power of citizens, contributing to decreased business activity. He cited Prime Minister Sitiveni Rabuka’s earlier acknowledgment of the VAT’s excessive nature but criticized him for later conceding to the influence of Finance Minister Biman Prasad and Fiscal Review Committee Chair Richard Naidu, who he claims supported the tax hike as an easy way to raise revenue amid significant debt.
The Labour leader characterized the VAT increase as a betrayal of electoral promises and criticized the government for not providing adequate support to lower-income workers, citing that the increase in social welfare payouts was minimal at just $15 to $20 per month. He emphasized that the government’s approach has not only burdened the public but has also failed to foster goodwill towards the ruling Coalition.
In summary, Chaudhry’s remarks highlight ongoing concerns about the socio-economic impact of tax policies in Fiji, particularly how they affect those in lower-income brackets. He advocates for a return to a more balanced tax rate that would alleviate some of the financial pressure on citizens and encourage economic growth.
This discussion is vital in considering fiscal policies that prioritize the welfare of citizens while also addressing national revenue needs. The call for a reduction in VAT could present an opportunity for the government to re-evaluate its strategies in promoting economic resilience.
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