Committee remains silent on 7-year tax exemption for Fiji Water

Fiji Labor Party leader Mahendra Chaudhry says it is surprising that the 2023 Tax Review Committee, which submitted a raft of tax measures for the 2024/25 budget, is remaining silent on one of the most questionable budget of last year – the period of seven years. tax exemption for Fiji Water.

He claims that the tax exemption granted to this extremely profitable foreign company was widely questioned and was a slap in the face to the rest of the population, which was equated with a 15 percent VAT on all goods and services, to with the exception of a few basic products. foodstuffs.

FLP leader says government has provided no satisfactory explanation as to why Fiji Water received such exceptionally favorable treatment while local manufacturers had their corporate tax rates increased by 20 percent to 25 percent.

Chaudhry says while 2023 Tax Review Committee Chairman Richard Naidu believes recommending an increase in the Water Resources Levy from the current 19.5 cents per liter will mitigate the unjustified tax exemption given to Fiji Water , he is wrong.

He says by all means increase the tax on water resources; after all, the introduction of a water resources tax in 2007 was his political initiative when he attempted to impose a water resources tax of 20 cents per liter of water and met with a strong backlash from Fiji Water.

The FLP leader says the 7-year tax holiday granted to Fiji Water is discriminatory and completely unjustified, and must be canceled in the 2024/25 budget.

He says local water bottling companies have publicly stated they have no objection to paying corporate tax.

He adds that the airport departure tax is already quite high and should remain at the current level of $140.

Prime Minister Sitiveni Rabuka had earlier said the corporate tax relief for the bottled water sector over seven years was aimed at encouraging new players who want to enter the industry in Tailevu, Ra and Ba, as well as existing operators who wish to expand their operations.

The Prime Minister said that the revenue measures provided in the 2023/2024 budget for the water bottling industry, i.e. the water resources tax increased to 19.5 cents per liter (an increase of 1.5 cents per liter), means the company will pay more taxes to the water sector. Fiji Revenue and Customs Service.

He had said that contrary to claims, Fiji Water was not exempt from paying taxes to Fiji under the 2023/2024 budget revenue measures.

Deputy Prime Minister and Minister of Finance Professor Biman Prasad will present the National Budget 2024/2025 next Friday at 10am.