Good news for people as from 1st April 2022, sugar, flour, rice, canned fish, cooking oil, potatoes, onion, garlic, baby milk, powdered milk, liquid milk, dhal, tea, salt, kerosene, cooking gas, soap, soap powder, toilet paper, sanitary pads and toothpaste are all going to become VAT zero-rated.
While announcing the 2021/2022 Revised National Budget, Minister for Economy, Aiyaz Sayed-Khaiyum says in total, this reduction will send $163 million in tax revenues back to the Fijian people and alleviate the cruellest burden that the pandemic and the Russian war have placed on our people’s backs.
Sayed-Khaiyum says the government will continue to review the price of food and other essentials as time goes on, a flexible policy posture will be maintained to adapt to the current circumstances.
The Attorney General says to alleviate the sharp rise in fuel price due to the conflict in Ukraine, the Government will also remove the current 20 cents fuel tax.
He says this will cost the Government approximately $56 million.
Sayed-Khaiyum says the prices remain volatile, and they will continue to monitor global crude oil prices and the events that are affecting them, such as the war in Ukraine.
He says in the same way, should crude oil prices stabilise, they may be able to reconsider this reduction.
From 31st August 2022, fiscal duty on imported liquid milk, full-cream powdered milk, yoghurt, cheese and butter will be reduced to 5% from the current 32%.
Fiscal duty rate on lunch boxes with a thickness of 1.88mm or more and which are not manufactured locally, water bottles, wheelie bins, meat patties and chicken nuggets, both raw and cooked, will be reduced from 32% to 5%.
Import Excise of 15% will also be removed from lunch boxes, water bottles and wheelie bins.
The Attorney General has also raised VAT on 21 items to 15%.
He says the increase in VAT to 15% will cover goods and services that previously attracted ECAL, such as prescribed services, white goods and motor vehicles, and will apply to all turnover in excess of $100,000.
ECAL will be removed and replaced by the adjusted VAT rate of 15% for these items.
He says the tax on an item that carried 9% VAT and 5% ECAL would increase by only one percent.
The additional list of goods and services to be taxed at 15% VAT includes alcohol, tobacco, textiles, clothing & footwear, perfumes, jewellery, watches, stereos and sound systems and other electrical equipment, and professional services such as legal and accounting, management and consultancy, architectural and engineering, scientific research and development, advertising and market research, veterinary activities and other professional, scientific and technical activities.
Minister for Economy Aiyaz Sayed-Khaiyum has announced they will increase the minimum wage to $4 an hour in four stages from its current level of $2.68.
While announcing the Revised Budget, Sayed-Khaiyum says from 1st April, 2022 the minimum wage will be starting from $3.01.
From 1st July it will start from $3.34 an hour, from 1st October it will start from $3.67 an hour while from 1st January 2023 it will be $4 an hour.
Sayed-Khaiyum further says for all the other 10 sectors, the minimum wage rate will also rise in tandem with new rates and topped up by the relative difference between the current national minimum wage rate and the sectoral wages.
He adds the current classification for the 10 sectors is decades-old and does not reflect the modern economy.
Sayed-Khaiyum says they have to recognise these shifts and align sectoral wages with market realities to ensure that people are paid just wages for the jobs they perform.
Meanwhile, for the next 3 years, the Government will provide, a 200% tax deduction to those employers who will be paying maternity leave for their staff, for the sake of the mothers of Fiji.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
From today, the wearing of masks will be optional, all venues may operate at full capacity and social distancing requirements will no longer apply.
Minister for Economy, Aiyaz Sayed-Khaiyum says it is up to people to apply the more than two years of experience we have with COVID to do what makes them feel comfortable and safe.
While making the announcement during the 2021/2022 Revised Budget address,Sayed-Khaiyum also says from 7th April, 2022, incoming travellers have to provide a Rapid Antigen Test within 24 hours and the 3 nights hotel stay will be removed.
Sayed-Khaiyum says all visitors to Fiji will play by the same rules because from 7th April, the government will also do away with the Travel Partner system.
He says the most important thing is that visitors be vaccinated.
The Attorney General says if they are vaccinated, and if they test upon arrival, their country of origin is less important.
Meanwhile $700,000 has also been allocated for Tourism Fiji to bring back additional staff for 5 days a week.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
Government’s total revenue is estimated at $2.25 billion while total expenditure is $3.72 billion for the 2021/2022 Revised Budget.
Minister for Economy, Aiyaz Sayed-Khaiyum says this will result in a net deficit of $1.46 billion equivalent to 14.2% of GDP.
He says government debt is projected to reach 88.6 percent by the end of this fiscal year and based on the projected economic recovery and planned deficit reduction, the debt to GDP ratio is expected to come down to below 80% in the next 3 years.
Sayed-Khaiyum says they are expecting the economy to grow by 11.3 percent this year driven by the vaccination of Fijians and the reopening of our borders.
He says other independent economic analysts put the figure even higher.
The Minister for Economy adds it’s estimated to take three years until Fiji’s economy is restored to pre-pandemic levels.
Foreign reserves currently stand at around $3.2 billion, sufficient to cover 8.8 months of imports.
Sayed-Khaiyum says with their largest earner of foreign reserves, tourism, shut down, Fiji faced a real threat of devaluation but the proactive and robust policies by the government and the Reserve Bank of Fiji helped avoid a devaluation of the Fijian dollar.
He says had Fiji been forced to devalue, Fijians would be paying much higher prices today for everything.
Sayed-Khaiyum further says liquidity levels in the financial system stand at around $2.0 billion, and that supported the low-interest-rate environment. He adds with improved confidence levels and reduced uncertainty surrounding the virus, investment prospects are trending upward.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
The Government will now provide full-time scholarships under the National Toppers Scheme effective from Semester 1 2022 for Bachelor of Medicine and Bachelor of Surgery.
While announcing this, the Minister for Economy Aiyaz Sayed-Khaiyum says this will amend the existing scholarship regulation to include students who did Year 13 in 2020.
Sayed-Khaiyum says in the 2021-2022 National Budget, Government allocated funds for MBBS students who had privately enrolled and met the criteria for a one-off $10,000 Government Grant.
He says in February this year, 42 students were selected and can use the grant to clear off the fees for 2021.
Sayed-Khaiyum says to accommodate private MBBS students of 2021, the National Toppers Scheme will change to include those who did Year 13 in 2020, had marks of 340 and above, a GPA of 3.0 and above in 2021, and combined parental income of less than $100,000.
The Minister also announced that the quota for nursing was set for 100 students for the 2022 new intake, but this may not be sufficient given the fact that many nurses are resigning, either leaving the profession or relocating.
Sayed-Khaiyum says to fill the gaps created by resignations and migration of nurses, the TELS quota for Bachelor of Nursing will be increased to 350.
He says the accelerated Repayment Incentives for TELS students was introduced in the 2018/2019 Budget to offer TELS students heavy discounts for the early repayment of loans.
Sayed-Khaiyum for this initiative, the determination of the repayment period for discount eligibility will exclude 2020, 2021 and 2022.
He says the quota for TELS for degree programmes will now be increased from 2,000 to 2,942, with increased attention to areas such as Medicine and Health, Engineering, Science and Technology.
Sayed-Khaiyum says the government has considered a one-off temporary measure to reduce the TELS entry mark to 250, except for the Commerce category, where the cutoff mark will remain at 280 with a quota of 850, due to the oversupply of graduates.
He says programmes in the Commerce category will still require an entry mark of 300.
Sayed-Khaiyum says as of 21 March 2022, the Fiji Maritime Academy had opened its doors to start the new academic year, offering a Diploma in either Nautical Science or Marine Engineering, with a range of short courses to obtain a Certificate of Competency.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
The Fiji Pharmaceutical and Biomedical Services Centre will launch an improved implementation model for the Free Medicine Programme in April this year.
Under the new model, participating private pharmacies will dispense listed medications from their own inventory and will be reimbursed by the Ministry of Health and Medical Services.
From today, GPs under the Public Private Partnership scheme will not be restricted from procuring medicine from the Government pharmacy.
Minister for Economy Aiyaz Sayed-Khaiyum says the Free Medicine Programme is funded at $8 million.
The list of free medicines has expanded to cover 140 items, comprising 136 medicinal products and 4 consumable items, mainly wound dressing materials.
From early May, open-heart surgeries will be available at the Lautoka Hospital – marking the first time in history that this procedure will be available all days of the year in Fiji.
Sayed-Khaiyum says other benefits will be added in the coming months including cardiac catheterisation, chemotherapy and renal dialysis.
He says concurrently, work is being undertaken to build a new Lautoka Hospital at the current site with no interruption to service.
He says Ba Hospital will move from Ba Mission Hospital on 9th April and all current services delivered at the Ba Mission Hospital will be provided at the new upgraded Ba Hospital facility.
Government is allocating $13 million to operationalise the Public Private Partnership arrangement.
Government has also provided $1.2 million to continue to subsidise Kidney Dialysis Treatment programme.
To date, a total of 135 registered patients are receiving their subsidised kidney treatment under the Dialysis Treatment Programme at six facilities across Fiji.
Sayed-Khaiyum also says the Free GP Scheme will also now include Free Dental Practitioners, as they will now also be engaging the private dental practitioners to improve the oral health of all Fijians, including school-aged children.
He adds the cost of private dental services will be borne by the Fijian Government at an agreed price with individual dental practitioners and private medical dental centres and hospitals.
They will offer services like consultation, oral examination, extractions, and temporary and permanent fillings. Patients will be served faster, and dentists will expand their services to more patients through the same model as the Free GP programme.
$500,000 have been allocated for this initiative.
$200,000 has been allocated to incentivise private GPs to open up new surgeries or clinics in rural areas; such as areas like Nawaicoba, Malolo, Naidovi, Drasa, Sabeto, Seaqaqa, Dreketi and Nasarawaqa.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
The Fiji Roads Authority has been allocated $338.2 million in the 2021-2022 Revised Budget of which $325.1 million will finance important capital programmes.
$60 million has been allocated to FRA for the renewal and replacement of severely deteriorated roads.
$34.02 million has been provided for maintenance and repair of bridges, and $14.5 million will fund ongoing contracts under the Rural Roads Programme.
Minister for Economy, Aiyaz Sayed-Khaiyum says they have also allocated $72.9 million for the maintenance of Fiji’s transport network and road assets such as drainage, footpaths, railings, signage, lights and signals.
$21.8 million has been set aside emergency restoration works to key infrastructure that suffered damage due to Tropical Cyclone Cody and other severe weather events.
Sayed-Khaiyum says due to damages to non-FRA roads since January 2022 due to TC Cody and heavy rainfall, FRA has been receiving requests for repair of these roads and other assets–mainly repair of community roads, crossings, culverts and clearing of drainage. He says $5 million has been allocated for rehabilitation of these roads. Under this allocation, priority will be given to those roads that provide access to hospitals, health centres, schools, settlements, communities and markets. Meanwhile, $102.1 million has been provided to rehabilitate major roads along Queens and Kings Highways, and complete the designs for the 40 critical bridges and three jetties–in Natovi, Savusavu and Nabouwalu.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
$6.3 million has been allocated in the Revised 2021-2022 National Budget to the Water Authority of Fiji to address water disruption issues in the Suva-Nausori corridor, Nadi, Lautoka and Labasa.
In total, WAF is allocated $195.2 million.
$80.7 million is for operating expenditure and $114.5 million is for capital investment in water and wastewater network.
$40.9 million is allocated for the Viria Project which is planned to reduce the number and extent of water disruptions and other woes in the Greater Suva-Nausori corridor.
Minister for Economy Aiyaz Sayed-Khaiyum says despite delays as a result of COVID-19, construction is well underway and expected to be completed by the first quarter of 2023.
The total cost of the project is around $270 million.
Once completed, the project will increase the capacity of the Water Authority of Fiji in the Suva-Nausori area by 40 million litres per day, with the plant designed for an additional capacity of 40 million litres per day.
On electricity, it has been announced that the Government will ensure the households in the Central Division that do not have access to electricity in areas such as Korovou, Tailevu, Namosi, Naitasiri and Serua will be connected to the Energy Fiji Limited grid.
Sayed-Khaiyum says during the next three financial years, the Fijian Government will be allocating a sum of around $20 million to fund a total of 177 schemes for which survey and quotations have been completed by EFL.
This will benefit more than 10,000 Fijians living in areas such as Mavua, and Navuto in Sigatoka; Dratabu, Navuso, and some areas in Votualevu in Nadi; Abaca, Natawarau, Lovu, Tavakubu, and households without electricity living along Vuda Back Road in Lautoka; Balevuto, Moto, Vatusui, and Vakabuli in Ba; Waiqumu Settlement, Wairuku; Nadele, Nabuna, Toko, Vuniniurea in Tavua; Navolau, Tavuvatu, and Naqaqa in Rakiraki. For the Northern Division, areas such as Muqumuqumu, Bulileka, and Korotari in Labasa; Nabalebale, Matakunea, Nasavu, Natuvu, and Natua in Savusavu; Drekeniwai, and Burotu in Taveuni.
$6.1 million has been allocated to extend the grid to communities that are not currently served.
Sayed-Khaiyum has revealed that a total of 48 schemes will be implemented, with more than 5,000 Fijians to be benefited from the programme – 13 in the Central Division, 29 in the Western Division and 6 in the Northern Division.
A total budget of $9.7 million has been allocated for the Housewiring and Grid Extension Programme.
$3.65 million of that total is for the complete installation of proper wiring in homes that will connect to the EFL grid system which will benefit 42,486 people.
Click to read: 2021-2022 Revised Budget Estimates
Click to read: 2021-2022 Revised Budget Supplement
SODELPA Leader Viliame Gavoka says their team will be up the whole night scrutinising the budget, but what he sees is an election budget.
He says the budget is overly optimistic and a lot of the figures need to be scrutinised closely.
Gavoka claims the growth projected in the Revised Budget is unrealistic and the government is understating their expenditure.
He says the Opposition is unhappy with the time given to them to scrutinise the budget because it's an important part of running an economy.
He adds they will be ready later this morning.
National Federation Party Leader, Professor Biman Prasad says the measures announced in the Revised National Budget is a case of accepting what NFP has been saying for the last several years however it is a little too late.
Prasad says the reduction in VAT on 21 items is designed to cushion the effects of the rising cost of living but the impact of that on the reduction in the price would be very little because the freight cost remains high.
He says the 20 cents per litre fuel tax should never have been imposed and the benefits should have been passed on to the consumers when the prices were going down.
Prasad says the measures that have been put forward to decisively deal with the rising cost of living is too little, too late.
The NFP Leader says apart from the removal of VAT from 21 items and the removal of the 20 cents per litre fuel tax, there is nothing much in this budget.
He says this budget is an attempt to pacify the people because Government knows that the people are angry.
The Fijian Government will invest $6 million for 51% shareholding in Counter Ruck Pte Limited, which was established by the Fiji Rugby Union to own and operate the Fijian Drua.
Minister for Economy Aiyaz Sayed-Khaiyum says the Fiji Rugby Union had requested a grant, but Government is unable legally to give a grant to a private company.
He says they can, however, take a share in the company and divest it at a later date.
Sayed-Khaiyum adds through this Revised Budget, the government will allocate the first tranche investment of $3 million for 25.5 percent shareholding.
The second tranche investment of an additional $3 million will be undertaken by December 2022 to secure the total 51%.
By December 2022, the Fiji Rugby Union will own 49 percent shareholding while the Fijian Government will own 51 percent.
In addition, Counter Ruck Pte Limited will be granted a 13-year income tax holiday, and will be provided a waiver for customs duty on goods imported specifically for the establishment of Fijian Drua-related venues and the High-Performance Unit for the period 1st July 2022 to 30th June 2023. A 200 percent tax deduction is also provided for sponsorships above $250,000 to the Fijian Drua.
Unemployed people living in Vanua Levu will have the opportunity to apply for one-off assistance of $100 with the specifics to be announced soon.
The Minister for Economy Aiyaz Sayed-Khaiyum says in this budget they have allocated $13 million towards unemployment assistance for Vanua Levu.
Sayed-Khaiyum says this programme also includes one-off assistance of $50 to all social welfare recipients in Fiji.
He says the bus fare subsidy for the elderly and disabled will be increased from the current $10 to $25 per month at a total cost of $6 million dollars benefitting close to 40,000 Fijians.
Sayed-Khaiyum says in 2021, government provided $430 million through its unemployment assistance programme directly to more than 400,000 people in the formal and informal sectors.
He says this programme was targeted at the population in Viti Levu because of the prolonged lockdowns and restrictions on the island.
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