The Fiji Revenue and Customs Service together with the Fijian Competition and Consumer Commission have formed a Price Surveillance Taskforce to ensure the changes in Value Added Tax (VAT) rates and customs duties announced in the 2023-2024 National Budget are reflected correctly in the final prices and consumer interests are protected.
Effective from 1st August 2023, the three VAT rates have been replaced with a simplified two VAT rate system.
The nine per cent VAT has increased to 15 per cent, while the zero per cent VAT rate has been maintained.
The 21 zero-rated VAT items have been increased to 22 items with the addition of prescription medicine and prescription drugs.
Additionally, import duties have been reduced on sheep and lamb meat, prawns, ducks, corned meat of lamb, sheep and beef, canned mackerel, canned tomatoes and chicken portions.
The FRCS team has also been conducting analysis of shipping and other related costs to verify the pattern of price changes.
FRCS Chief of Staff, Shavindra Nath, stated that it is important to ensure that the intention of the budget policies announced by the government is achieved.
“When taxes or duties are reduced, the intent is to reduce the prices of these products and promote consumer choices. If the prices are not reduced, then it defeats the purpose of these changes.
“That is why it is critical for agencies such as FRCS and FCCC to monitor that these changes are correctly reflected in the prices.”
“The VAT zero rating has been maintained and, in fact, increased with the inclusion of prescribed medicine and drugs and the increase in VAT from nine per cent to 15 per cent should not impact the prices of these zero-rated items,” he said.
“FRCS is aware that a large majority of retailers wish to comply with the law, and we are willing to help and guide them so that they can implement these changes correctly. However, instances of deliberate non-compliance will be dealt with strongly.”
FCCC chief executive, Joel Abraham said cost of living is a matter that resonates deeply within our communities.
“It’s not just an economic issue; it’s a fundamental aspect of daily life that affects families across Fiji.”
“The collaboration between FCCC and FRCS on Price Surveillance is more than a regulatory step; it’s an initiative aimed at safeguarding the welfare of our citizens.”
“The new VAT system and duty reductions should make essential goods more affordable.”
“We’re committed to ensuring these changes are accurately reflected in market prices, and any non-compliance will be met with decisive action.”
Abraham said together with FRCS, they are working to ensure the Government’s intentions become real benefits for our people, focusing not just on compliance but on enhancing their quality of life.