The Government is earning millions more in fuel-related tax revenue as record fuel prices continue to squeeze households and businesses, according to new analysis by Dialogue Fiji.
The organisation is calling for an urgent reduction in fuel duties, arguing that while ordinary Fijians are paying significantly more at the pump, Government revenues have also risen sharply due to higher VAT collections linked to increased fuel prices.
Dialogue Fiji Executive Director Nilesh Lal said the public was carrying the burden of the fuel crisis while Government’s tax earnings continued to climb.
“Ordinary Fijians are paying more every time they fill up their vehicles, buy groceries, or pay for goods and services,” Lal said.
“At the same time, Government is collecting significantly more tax revenue from every litre of fuel sold than it was before the crisis began.”
According to Dialogue Fiji’s analysis, Government revenue collected from petrol has increased from 74 cents to 90 cents per litre, while revenue from diesel has risen from 44 cents to 71 cents per litre since before the Strait of Hormuz fuel crisis.
The organisation estimates that Government is now collecting approximately $10.7 million in fuel-related tax revenue compared with $7.26 million before the crisis, an increase of about $3.44 million or 47 per cent.
“This is not a situation where Government is simply standing on the sidelines while citizens suffer the effects of international events,” Lal said.
“The reality is that Government is also benefiting fiscally from these higher fuel prices through increased VAT collections.”
Dialogue Fiji said the increased revenue comes at a time when fuel prices have reached historic highs, with petrol now selling at $3.93 per litre and diesel at $4.58 per litre.
The group is urging Government to share the burden by temporarily reducing fiscal duties on fuel to provide relief to consumers and businesses struggling with rising living costs.
“A government cannot credibly argue that fuel prices are beyond its control while simultaneously collecting substantially more tax revenue from those same price increases,” Lal said.
