Leader of the Opposition Inia Seruiratu says the Coalition Government is spending money like drunkards in the nightclub.
Seruiratu, who is also the Shadow Minister for Finance in his response to the 2023-2024 National Budget in Parliament today said the Government should stop making excuses and carry on with the job.
He said the public debt had been on a decline prior to the onset of COVID-19 and the debt to GDP ratio had dropped to below 50 percent and only rose as Fiji tried to counter the effects of COVID-19 and to ease the impact on our people.
“The total debt will increase to more than $10 billion, despite the fact that they have been harping on about excessive debt over the past few years.”
“A 25 percent increase in the revenue has been highlighted in the 2023-2024 budget through various means including increase in VAT from 9 percent to 15 percent for all non-zero rated items, increase in company tax with the exception to companies listed on the stock exchange, the range of excise tax increases together with the removal of various incentives that were designed to stimulate investment.”
Seruiratu highlighted that there are significant weaknesses in the reasoning behind the revenue forecast because it does not take into account the likely changes in the spending habits that will happen when the VAT increase kicks in and also the tax increases, departure tax increases and duty increases on the current high tourism arrival forecast.
He said the middle income earners are the ones that have money in their pocket and spend.
“Consumption goes up when they have enough take-home pay.”
Seruiratu also mentioned that despite Government’s intentions to increase social welfare benefits, he believes this is not big enough to offset the increase in particularly in non-zero rated items.
“To reduce three levels of VAT to two will be a welcome relief to businesses and also to FRCS, but the notion that the enhanced expenditure support measures will adequately compensate for the losses that the most marginalized will have to pay as a result of VAT increases is something they do not fully subscribe to.”
“Company tax increase from 20 percent to 25 percent while companies that were off the stock exchange who were eligible for 10 percent will now increase to 15 percent,” he added.
Meanwhile, the National Budget Debate continues in Parliament tomorrow.