Fiji Opposition rejects tourism tax burden on industry

Fiji's Opposition has voiced strong opposition to a proposed five percent tourism services tax, arguing it places an undue financial burden on the tourism industry. While acknowledging Fiji Airways as a vital national asset, the Opposition contends that the responsibility for its financing should not fall almost entirely on the tourism sector.

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We recognize that Fiji Airways is a national asset carrying around 80 percent of our international visitors. Its success is vital to tourism, employment and the wider economy and in fact, Fiji Airways is our pride

During parliamentary debate, Opposition MP Premila Kumar stated, “We recognize that Fiji Airways is a national asset carrying around 80 percent of our international visitors. Its success is vital to tourism, employment and the wider economy and in fact, Fiji Airways is our pride.” However, she questioned the fairness and transparency of the funding model proposed in the Tourism Services Tax Bill 2026.

The bill, introduced by Finance Minister Esrom Immanuel, seeks to impose a temporary tax on tourism businesses with annual turnovers exceeding $2 million. Revenue collected between September 1, 2026, and August 31, 2027, is earmarked to help Fiji Airways cope with increased fuel costs linked to the Middle East conflict. Immanuel argued the measure is essential for protecting Fiji's tourism industry and economy, warning of adverse impacts without support.

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The issue before Parliament is not whether Fiji Airways deserves support but whether this Bill provides a fair, transparent and accountable way in providing that support

Kumar countered that the tourism industry, still recovering from the COVID-19 pandemic, should not bear this responsibility alone. Many businesses are still repaying loans and rebuilding financial reserves. She criticized the tax for being based on gross turnover rather than profit, stating, “Businesses making little or no profit will still pay the same tax as profitable businesses, and that is fundamentally unfair.” The Opposition also questioned why tourism businesses should subsidize Fiji Airways, which operates competing hotels, and urged the airline to demonstrate cost-reduction efforts before seeking government aid.

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Businesses making little or no profit will still pay the same tax as profitable businesses, and that is fundamentally unfair. As a result, businesses are left with only two choices. Either they break their contract with the customers, or they absorb the additional tax themselves.

Despite these objections, the bill was passed and enacted. The Opposition reiterated its support for assisting the national carrier but insisted that such support must be managed equitably and with full parliamentary accountability.

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We would like to know how they are reducing those costs if they are in a terrible financial situation