Opposition MP Premila Kumar has questioned the Government’s decision to link the new 5 per cent Tourism Services Tax directly to funding Fiji Airways, warning it sets a concerning precedent.
Speaking during debate on the Tourism Services Tax Bill 2026 in Parliament yesterday, Kumar said she had no objection to Government supporting the national airline but argued the funding should not come solely from one industry.
“I would prefer to hear that Fiji Airways will be assisted with $70 million… and then you can separately announce that we are now introducing a new tax called tourism tax.”
Kumar said tying the new tax directly to Fiji Airways raises several concerns, particularly because the airline also owns and operates a hotel.
She argued that hotels and other tourism operators would effectively be helping to fund a direct competitor.
“Fiji Airways themselves are operating a hotel. They’re in direct competition with hoteliers, so why should this hotel industry be bailing out Fiji Airways?”
Kumar also questioned why the tourism sector alone should bear the cost of supporting the airline, suggesting that if Government believed additional revenue was needed, it should be collected more broadly.
“My solution was you introduce taxes across the board for everyone else to pay for it, not just one sector.”
She warned the move could create a precedent for future industry bailouts funded by taxes imposed on unrelated sectors.
“The precedent you have set is this: next time, if FSC needs money… another sector will now pay directly to the sugar industry. This is the precedent you have set.”
Kumar said she was unaware of any comparable system where tax collected from a single industry was earmarked specifically to fund another government-owned commercial entity.
“You are simply saying that this money will be collected and paid directly to Fiji Airways.”
