TAG defends tourism services tax

The Tourism Action Group (TAG) has publicly defended Fiji's temporary Tourism Services Tax, asserting that the measure is crucial for maintaining air connectivity and safeguarding the nation's vital tourism-driven economy. The group emphasized that the tax was introduced as a necessary response to escalating global aviation fuel prices and ongoing disruptions impacting international airline operations.

TAG highlighted the significant financial strain faced by Fiji Airways during the fuel price surge, which raised concerns about the airline's capacity to sustain its full international flight schedule. The group warned that any reduction in air capacity would have severe ripple effects across various sectors, including hotels, transport operators, restaurants, and the thousands of businesses reliant on tourism.

Further illustrating the industry's challenges, TAG pointed to regional capacity cuts, such as Air New Zealand's reductions on Fiji routes, as evidence of broader industry adjustments. The group stated that discussions involving the government, airlines, and tourism stakeholders explored multiple options, including tax adjustments and financial support. The temporary levy was ultimately chosen as part of a comprehensive strategy to preserve Fiji's international connectivity during the crisis, with TAG maintaining the decision was a collaborative effort.

Looking ahead, TAG is now advocating for greater transparency in how the collected levy funds are managed and reported. The group believes this is essential for ensuring public and industry accountability. TAG referenced Fiji Airways’ previous management of COVID-era tourism support funding as an example of the airline's capacity for proper oversight. The group reiterated that protecting air connectivity remains paramount, as Fiji Airways is the primary carrier for international visitors to the country.