News

Fiji Water incentive questioned

July 5, 2025 12:25 pm

A seven-year tax holiday granted to Fiji Water has sparked further public debate after a businessman challenged its economic logic at the post-budget forum.

The businessman, who said he has raised the issue multiple times in members’ forums without receiving a response.

He questioned how much tax revenue the government stands to lose from the incentive and whether similar benefits are extended to other companies in the bottling industry.

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In response, Finance Minister and Deputy Prime Minister Professor Biman Prasad said the decision was made strategically to support Fiji Water’s operations in the US and to strengthen the country’s export competitiveness.

He said the tax break was not a loss to government revenue, but rather part of a larger structure that allows more income through other tax streams, including a 32 per cent tariff on water extraction.

“I think you are beating something that we have clarified time and again, and again your understanding of the tax regime that we provided to Fiji Water is in fact helpful not only in terms of raising revenue. Government is not losing a single cent. In fact, we are gaining more revenue.”

According to Prof Prasad, the tax arrangement helped position Fiji Water to deal with international tariffs and the net effect has been beneficial for both the company and the country’s tax base.

He did not specify if similar tax incentives are available to other businesses in the sector, but maintained that the Fiji Water deal was a well-considered economic decision that serves the national interest.

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