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VAT reduction not bad thing says USP head of economics



By: Mika Loga – FIJI ONE NEWS – MONDAY AUGUST 11, 2014

As the debate on Value Added Tax rages on, at least one economist says, it is still possible to further reduce VAT on essential items not in the list of controlled items by the Commerce Commission.

The University of the South Pacific’s head of of economics, Professor Satya Pau says, a reduction could still be beneficial to both consumers and the government.

USP academic Professor Satya Paul shares his views on VAT as debate on the issue heats up leading into the polls.

“This tax is not pro poor. It doesn’t help the poor because everybody pays the same tax. It’s not a progressive tax as it is a regressive tax,” says Pofessor Pau.

There are some items where VAT are charged and the retail prices are fixed by the Commerce Commission.

These are referred to on supermarket shelves as controlled priced.

Certain political parties have proposed a reduction in VAT to 10 percent.

This has resulted in strong debate amongst political parties.

“You reduce 15% to that case, it doesn’t mean one does mean the revenue will decline by one third because when you reduce the price, the commodities become cheaper, people demand more, they spend more and the Government collect more taxes at 10%. This is the logic of bringing it to 10 percent,” says Professor Pau.

Another political party has proposed other ways of resolving VAT by subsidising the prices of an approved list of VAT free basic items.

“I dont think think this will do it, they should bring it to 10% or 11% whatever the fugure is consensus to the whole of Fiji. Then the Government can increase the income tax a little say around 20%,” added the USp head of economics.

There are certain items however, that are not scrutinised by the Commerce Commission. They include some canned goods which are essential food items in almost every home.

Either way, it will be a balancing act for any Government when it comes to taxes on basic food items.

“In this case the Government has to be very careful which are the items coming very cheap, in that case Government can impose some of the taxes on the imported goods so that the domestic market becomes stronger,” says Professor Pau.

On the street, the views differ.

“Governmment should reduce the price of the items because the income is so less, the things are going up,” said one consumer.

“As I see it, the prices of items this week are still the same. They are still sold at reasonable prices..people like me can afford it,” said another consumer.

Whatever the proposed political solutions are to VAT, ultimately it’s consumers who will decide how it impacts their pockets.


NFP outraged at extent of environmental destruction in Kavula, Bua under Bainimarama administration

Environmental protection, robust environmental safeguards and Free, Prior and Informed Consent in development projects will be a priority of an NFP Government and there will be an end to administrative technicalities that undermine the food and human security of people in Fiji said Seni Nabou, the NFP spokesperson for the environment.

“The Fiji Times story highlighting the environmental travesty in Bua is both deeply concerning and outrageous ” said Nabou.

“It is all too convenient for the roadworks sub-contractor JJ Gravel Extractor and the Acting Commissioner Northern Alipate Bolalevu to sidestep the issue and lay blame on the Environment Department and landowners for granting their approval when it is common knowledge that most of these projects are being driven top-down and the EIA processes are merely rubber-stamping what this administration wants”, added Nabou.

Nabou asserts that while national development is welcome, it should be not be at a cost to the people who depend on their immediate natural surroundings especially where food security is concerned. “This is why proper and robust EIA processes and allow for public oversight as destruction to one ecosystem has ripple effects to other areas,” said Nabou.

Nabou adds that Free, Prior and Informed Consent for landowners in all development projects are a priority of an NFP Government and that all development decisions under the Bainimarama administration that have sacrificed the environment and the people who depend on it will be reviewed and that appropriate sanctions put in place.

The NFP is calling on the Bainimarama administration to put in place a moratorium to gravel extraction until the rest of the EIA process is properly effected, scientific assessments of the environmental damage made public and compensation for landowners negotiations started immediately.

Seni Nabou

NFP spokesperson on Information, Media, Communications and Environment.


Phone: 9922053

NFP condemns lack of consultation and inclusiveness in the decision to hold Women’s Expo

Lack of consultation with women’s organizations will be a thing of the past if the NFP wins the elections.

The recent women’s expo held in Suva is indicative of unilateral decision-making between the Ministry of Women and women’s NGOs. This continues to be an issue with women’s organizations in the last couple of years as the Ministry of Women has continuously sidelined women advocacy groups in all its activities and decisions despite their years of valid credibility on this front.

“Dr Jiko Luveni has not respected the national structures and machinery of decision-making with women’s groups but has chosen instead to deal with individual women’s organizations and even individuals who have benefitted from the programs of the ministry of women. These divide and rule tactics will stop and women will truly be consulted in all decisions regarding women in an NFP Government.” said Fay Volatabu the party spokesperson for Women, Peace and National Reconciliation.

“The Ministry of Women was set up by the pioneers of National Council of Women Fjii (NCW Fiji) and the Soqosoqo Vakamarama i Taukei (SSV) to be the voice of women in parliament but in recent years the Ministry under Dr Luveni’s leadership has not been liaising with women’s NGOs choosing instead to undermine these structures”, added Volatabu.

Volatabu adds that if women’s progress is to be truly representative and reflective of all women then all umbrella organizations have to be consulted by the ministry as partners in all it’s programs as well as in the compilation of statistics in their research and reports.

On Gender Equality and Empowerment of Women, the National Federation Party has committed in its manifesto to:

  • promote gender equality in access to productive resources, economic opportunity and decision making at all levels contributes to higher economic productivity and wellbeing for all;
  • commit stronger initiatives to gender equality for women in Fiji because despite some progress they still have less access than men to policy decision making, employment and productive assets;
  • commit to gender aware public policy and reforms to achieve gender equality to promote more rapid development;
  • reform existing policies and programs to strengthen the voice and participation of women in households, communities and in society, including in local government, on boards and other levels of governance; and
  • primarily concentrate on five pillars for achieving gender equality and empowerment of women:

(i)    reduce gender based violence,

(ii)  strengthen women’s endowments and economic opportunities

(iii)strengthen the legal and institutional environment,

(iv)transform social norms and practices and

(v)  take measures to enable women’s participation in the policy domain by creating space for women’s collective action.


Fay Volatabu

NFP spokesperson on Women, Peace and National Reconciliation.


Phone: 9163693

Two Lawyers Join NFP

Two lawyers have joined the National Federation Party to contest the September 17 general elections under the NFP banner.

The latest inclusion of both lawyers brings to 45 the number of candidates announced so far to contest the elections. This number would have been 48 had not been for the Electoral Amendment Decree’s definition of “ordinarily resident”.

On Tuesday two of the Party’s prominent candidates Makereta Waqavonovono and Jone Vakalalabure had to withdraw their candidacy as a result of the decree. Former national rugby union representative and former teacher Seru Rabeni stepped aside after being endorsed and slated for announcement on Tuesday for the same reason.

The candidates announced today are: –

1               Semi Titoko

Simi Titoko outside

Born in Nalawa Ra, Semi Titoko is a lawyer operating the firm of Qarcia Barristers & Solicitors at Vaileka.

Mr Titoko was employed in the Judiciary for 8 years between 1992 and 2000. He worked in Nadi and Suva Magistrates Court and the High Court at Lautoka.

He was then a private law student at the University of the South Pacific between 2003 and 2008. He has been practicing as a lawyer since 2009.

Mr Titoko has been approached by the chiefs of Ra to be the voice of Ra people in Parliament. The chiefs have endorsed his decision to contest the elections under the NFP’s banner.

Mr Titoko is eager to be part of Team NFP for the future of Fiji.

2.         Siddiq Faizal Koya

Inside Faizal Koya

Siddiq Faizal Koya, born in Lautoka but now a resident of Nadi, is a barrister and solicitor with Siddiq Koya Lawyers.

Mr Koya graduated with an Honours Law degree from the University of Wolverhampton in United Kingdom. He also served as a magistrate.

Mr Koya has a record of service; as the legal advisor to the Rotary Club of Nadi, Speaker of Fiji Muslim League and Speaker of MA’natul Islam Association. He takes keen interest in youth and sports development and is a strong advocate against animal cruelty.

He believes that authoritarian government anywhere in the world is not good governance and that educated young people need to take the nation forward in contrast to those leaders who have polarized the nation on various issues.

His father, Siddiq Moidin Koya, was one of the founders of NFP in 1963 as Deputy leader to A D Patel. Mr Koya succeeded Mr Patel as NFP leader after Mr Patel’s death in October 1969 and also took over responsibility of negotiating Fiji’s Independence from Great Britain together with Ratu Sir Kamisese Mara.


National Federation Party categorically DISAGREES with the following claims by Fiji First candidate Mahendra Reddy and the Fiji First Party


Claim 1: VAT will not provide relief to the poor

• It is true that VAT is zero on tinned fish, flour and sharps, powdered milk, edible oil, rice and tea. However, a typical poor household does not only consume these items. A typical basket for any poor household also includes consumption of electricity bill, water bill, mobile phone recharge, frozen meat, bread, processed food such as noodles, transportation and entertainment.

• Rich consume more fresh meat products (such as fish, goat, chicken) while poor totally depend on supermarket for meat (tuna, lamb neck, frozen meat).

Claim 2: Reducing VAT from 15% to 10% will reduce VAT revenue by 33%

• It does not necessarily mean that reducing VAT by 5% will reduce VAT revenue by 33%. VAT is a consumption based tax. As prices go down after VAT reduction, consumption expenditure is bound to increase which will also increase the tax base. The revenue that would have come to the government will now go to into the pockets of the people.

• It should also be noted that between 2012 and 2014, VAT revenue increased by F$160m. During this time, there was no increase in VAT rate. This is evident that VAT revenue is not totally dependent on the VAT rate but the rate of economic activity as well.


Claim 3: Reduction in VAT will reduce government expenditure on roads and hospitals

• NFP does not see any connection between VAT revenue and the expenditure to provide good roads and quality health services to our people. The statement by the Fiji First Party is totally flawed. NFP will be guided by a medium to long term infrastructure plan for our roads and hospitals.

• NFP will reduce wastage of government financing through efficient checks and balances and ensure the productive use of government revenue.

Dr Sunil Kumar
NFP Spokesperson:
Economy, Finance & Trade

NFP Newest Candidates

Party announces new candidates

Dawn Gibson
Wednesday, August 06, 2014

THE National Federation Party yesterday announced four more candidates to contest the September election.

The four names announced were former Ministry of Trade and Commerce employee Simione Naituku, Justice of the Peace Deven Magan, Pino Venasio — a history and politics undergraduate student at USP who hails from Rotuma, and NFP leader Professor Biman Prasad himself.

Mr Naituku believes that “powerful, courageous and visionary leadership” is needed to uplift the economy and combat poverty and unemployment in Fiji.

“Mr Magan has an active involvement in social work. He served as a Suva City Councillor for 20 years from 1999 to 2009 until all municipal councils were dissolved by decree by this government,” Mr Prasad said yesterday.

Mr Venasio, who hails from Juju in Rotuma, joined NFP to highlight social, political and economic advancement on Rotuma.

“This brings to 45 the total number of candidates announced so far to contest the election under the NFP banner,” Mr Prasad said.

“However, this number is being reduced to 43 following the promulgation of the Electoral Amendment Decree last week (Decree No. 26), stipulating residency period contrary to common understanding and past electoral legislation.”

He said while there would have been 45 candidates, recent penalties placed upon now former candidates Makereta Waqavonovono and Jone Vakalalabure have reduced NFP’s candidate number to 43.

“It is regrettable that this has resulted in the withdrawal of two of our competent and highly qualified candidates who have been penalised by this amendment decree.”

Ms Waqavonovono is a lawyer, former magistrate and former director of the Legal Aid Commission. She recently studied for a Masters degree in Australia. Mr Vakalalabure also recently returned from Australia with a Masters Degree in International Relations.

National Federation Party Condemns Electoral Decree Amendment

The National Federation Party condemns in the strongest terms, the amendment to the electoral decree issued last week with regard to who is “ordinarily resident” in Fiji to qualify to stand for elections.

The amendment has ruled out two of the party’s leading candidates from standing in the upcoming general elections, Ms. Makereta Waqavonovono and Mr. Jone Vakalalabure.

These two highly qualified Fiji islanders would have been two of the best parliamentarians to have served our country.

This is the calibre of Fiji islanders that our country needs to take Fiji onto another level of service to the public.

Yet the interim administration sees it fit to disqualify them for being away acquiring higher professional skills that would have served our country greatly through parliament.

The process of amending the decree last week was just as bad as the substance of the amendment.

The amendment was from the office of the Attorney General whose most senior lawyer was representing the defendants in litigation before the high court.

Litigation brought by Ms. Waqavonovono asking the court for constitutional and human right redress with regard to her eligibility to stand for elections.

And as we all know, the AG is also general secretary of a rival political party and one of the defendants in that litigation as Minister responsible for the Elections.

It is a matter of grave concern that a defendant in live proceedings, who happens to be AG as well general secretary of a rival political party and Minister Responsible for Elections and the Electoral Decree, be allowed to change electoral rules by decree, weeks away from the elections.

It is also very disrespectful to the Court.

The party also expresses great concern that while the matter of the litigation was live before a Judge of the high court, the Chief Justice signed the amendment decree as Acting President of Fiji.

The National Federation Party is not taking this issue of disenfranchisement by decree lightly. The party will be exploring its options further.

After eight years, the people of Fiji deserve, at the very least – free and fair elections. One that is free of interventions by decree from one of the parties contesting those elections.


Kamal Iyer
General Secretary


The National Federation Party has today announced four more candidates to contest the September 17 general elections.

This brings to 45, the total number of candidates announced so far to contest the elections under the NFP banner. However, this number is being reduced to 43 following the promulgation of the Electoral Amendment Decree last week (Decree No. 26), stipulating residency period contrary to common understanding and past electoral legislations.

It is regrettable that this has resulted in the withdrawal of two of our competent and highly qualified candidates who have been penalized by this amendment Decree. They are Makereta Waqavonovono, a lawyer, former magistrate and former Director of Legal Aid Commission, and Jone Vakalalabure who has a Masters in International Relations.

Civil servants should stop doing government’s bidding

Senor civil servants are blatantly politicking via the media by doing bidding for Government whose leadership and ministers are contesting the elections under the banner of Fiji First.

The latest example of civil servants publicly indulging in politics was on “4 the Record” programme on Fiji Broadcasting Commission Television on Sunday night. The guests on the programme were the Permanent Secretary for Finance Filimone Waqabaca, Deputy Governor of the Reserve Bank of Fiji Arif Ali and Chief Executive of Fiji Revenue and Customs Authority (FRCA) Jitoko Tikolevu.

While responding to a leading question from a journalist on the panel, Mr Tikolevu said a reduction in Value Added Tax (VAT) would have little impact on the price of goods. Mr Tikolevu, in dismissing the issue of VAT reduction, went onto to say even an increase in VAT to 20% would be insignificant.

It is quite clear that Mr Tikolevu was trying to rubbish the National Federation Party’s promise to reduce VAT from 15% to 10%, that has been consistently advocated by the Leader and the Party for the last four months.

As a senior public servant, Mr Tikolevu should know his role is only to implement Government policies. Their role is to implement Government policies. And this includes any Government that comes into power after the September 17 general elections.

By commenting on a policy proposed by a political party, in this case explained in detail in the NFP’s manifesto, Mr Tikolevu has totally compromised the neutrality and independence of his position as FRCA Head as well as that of the Institution. He should have remained apolitical and completely refrained from making political comments. A ordinary civil servant is disallowed from even to be seen at political party meetings or gatherings as it is construed as showing support towards a political party.

FRCA is an Independent Institution. Unfortunately, Mr Tikolevu has given it a semblance of a political wing of Government and the Fiji First Party.

Also Mr Waqabaca commented that he was on the programme because of what he called “misleading statements about the economy”. Instead of politicking, Mr Waqabaca must tell the people of Fiji what is the real state Government finances and the proposal in the 2014 Budget to rake revenue through sale of State assets.

The NFP once again calls upon officers in all independent state institutions to remain apolitical at all times. We also warn that by indulging in political campaign, senior public servants are showing their political bias and tarnishes their credibility and suitability to hold similar senior positions following a change of government and restoration of democracy after the elections.

Kamal Iyer

General Secretary


A former magistrate, a women’s advocate, a renowned academic and a senior corporate executive are amongst the latest batch of 7 candidates to be endorsed by the National Federation Party to contest the September 17 general elections. The latest announcement follows 6 endorsements in Ba and Lautoka over the weekend and brings the total number of candidates endorsed by the NFP so far to 37.