To reduce Value Added Tax now to 12.5% is a token reaction to the angry public sentiment, said Fiji Labour Party leader, Mahendra Chaudhry.
He described the 2025-2026 budget as a “damage control” budget to appease the people after the pain and suffering inflicted by the Coalition’s past two budgets,
“To reduce VAT now to 12.5% is a token reaction to the angry public sentiment,” said Mr Chaudhry.
“However, it is not enough to offset the cost of living as businesses will attempt to retain their margins and not reduce prices. Labour Party had called for a reduction to at least 10% to make a credible impact.”
“The 5% increase in Welfare benefits is not sufficient to match the cost of living as global inflation is expected to rise in the next 12 months.”
Mr Chaudhry also criticised the $886m budget deficit.
“It will push Fiji further into an already unsustainable debt level.”
“Fiscal deficits under the Coalition have risen from 3.5% in 2023/24 to 4.5% in 24/25 and now 7.5% under the 2025/26 Budget.
“In many cases, the expansionary measures announced are meant for show – attempts to dazzle with unrealistically big figures and high-sounding projects.”
“There is not much hope of these being realised on the ground because of a lack of capacity and the continuing shortage of the required skilled workforce.”
“It is clear that these constraints have been ignored by the architects of the Budget.”
