The Fijian Competition and Consumer Commission (FCCC) is cautioning traders to ensure they are correctly applying the 15 per cent VAT rate, which came into effect on 1 August, to the price of their goods and services.
This comes after reports of some traders directly applying either an additional 15 per cent VAT or 6 per cent VAT to the existing prices.
Effective from 1 August 2023, the three VAT rates have been replaced with a simplified two VAT rate system.
The 9 per cent VAT has increased to 15 per cent while the 0 per cent VAT rate list of items has been maintained, other than the addition of prescription medicine and prescription drugs.
FCCC chief executive, Joel Abraham, said that if a trader is unsure, they can calculate the new price by taking the original price, divide it by 1.09, then multiply it by 1.15, as follows:
New Price = (Old Price/1.09) x 1.15
“It is the responsibility of traders to ensure they are correctly applying the new VAT rates or they will be taken to task,” said Abraham, adding that a joint taskforce, composed of FCCC and Fiji Revenue and Customs Services officers, is conducting surveys and inspections to ensure compliance.
“Since the budget announcement, we have conducted around 1,070 surveys and inspections and are maintaining the pace, through participation of FCCC employees from all departments, not just enforcement.”
“Unethical traders who are trying to unfairly profit by taking advantage of the transition should know that we’re committed to ensuring that the budget changes are accurately reflected in market prices and any non-compliance will be met with decisive action.”