Fiji Labour Party (FLP) leader Mahendra Chaudhry says the explanation provided by Minister of Finance Professor Biman Prasad on the corporate tax exemption for water bottling companies is “full of holes”.
In response to the minister’s right of reply in Parliament on Wednesday night, Mr Chaudhry said the explanation “did not make any sense”.
“The minister wants people to believe that local bottling companies proposed a hike in the water resource tax (WRT) in return for corporate tax exemption just to help their foreign competitor claim tax credits in its home country,” he said.
“Crazy enough as the explanation is, can the minister explain how tax credits can be claimed if tax is not paid (exempt) in the first place? He also said that both the water resource tax and corporate tax were two distinct taxes, and that no tax credits could be claimed in respect of water resource tax.
“Other local and foreign owned beverage companies pay both the taxes. Their corporate tax and excise tax rates were increased in the 2023-2024 budget. Why then the corporate tax exemption for water bottlers?
“It just doesn’t make sense. We need to dig deeper.”
