THE telecommunication sector is next on the list to be carefully scrutinised by Consumer Council of Fiji on whether they have applied the 6 per cent reduction of value added tax (VAT) on their services.
The three telecommunication and mobile companies have been notified by the council.
The companies are Vodafone Fiji Ltd, Digicel Fiji and Inkk Mobile Fiji.
The council’s CEO Premila Kumar says she sent the companies emails last week and is awaiting response.
“My emails are out to all the three telecommunication companies — Vodafone Fiji Ltd, Inkk Mobile and Digicel Fiji — for them to explain,” Ms Prasad said.
“Just sharing this story with you, we are quite surprised at the office because my team usually use recharge cards. We buy this many recharge cards every month.
“This time around, they bought recharge cards and the prices are still the same.”
The argument, she said, was the mobile companies would say they were giving better calling rates and they were going to give more.
“They are going to reduce per call rate or whatever, I don’t know what their excuses would be. The question is did we save a dollar?”
And because the idea of VAT is for customers to save a dollar, she said the argument by mobile companies that they were giving customers more for the same price, was wrong.
“Because each and every trader, rather than 1kg they will make it 1.10kg and they would say hey, we are giving you 10 grams more and the prices are still the same.”
As consumers, she asked whether we were asking for more?
“We are not asking for more. The VAT argument is saving a dollar and not getting more.”
She said this was not about quantity, it was about reduction in prices.
As soon as the council completed this exercise, Ms Kumar said, this could be another area that could be debated upon.
Vodafone Fiji CEO Pradeep Lal said Vodafone was able to pass on the benefit of the reduced VAT with a reduction in its tariffs of between 6 and 9 per cent.
Fiji prepaid customers will pay 9 per cent less for their call charges effective from December 31, 2015.
Mr Lal said the reduction in Vodafone Fiji’s mobile charges came into effect a day earlier than the reduction in VAT, which was January 1, 2016.
Mr Lal said while the reduction in VAT by Government was 6 per cent, Vodafone had been able to pass a bigger reduction of between 6 and 9 per cent on some of its services.
Digicel customers could expect a 6 per cent drop in their calls, texts and data charges from January 1, this year.
A statement from Digicel Fiji in December 31, 2015 said the reduction in rates and call charges was to comply with the new VAT implementation requirement from January 1.
Digicel Fiji CEO Darren McLean said all customers would benefit from the VAT reduction.
“We are always looking at ways to deliver the best service and affordable rates for customers. The new VAT reduction means that our customers will save even more on their communication costs,” said Mr McLean.
The council is going through sector by sector and is now looking at the telecommunication industry.
“We are going sector by sector because there are so many things happening.”
The council had already scrutinised the transport sector, restaurants, bistros and cafes.
