[File Photo]

Minister for Infrastructure, Jone Usamate says the high taxation rates in Fiji a few years ago, had led to the issue of the black economy.

Usamate says because of high taxation people in the country were hiding their revenue.

His comments come when Social Democratic Liberal Party Leader Viliame Gavoka questioned the government’s taxation policies in parliament his morning.

Gavoka gave an example of the Stamp Duty Act of 1920, saying the country lost many opportunities for revenue when the decision was made to repeal the act.

“We on most occasions do this blindly, and that is inexcusable. Did we know that when the Honourable Minister (Aiyaz Sayed-Khaiyum) said that we will repeal the Stamp Duty Act that we will be losing $80m? Did we know that? We did not.”

Usamate in response gave examples of what the government found when he was the Minister for Employment.

“We used to walk into shops and these companies would have two sets of books for the wages. One that they show to others, and the others that they keep for themselves. This was happening across the board.”

Usamate adds this is why the government reduced the taxes which made people show their true books.

He also clarified that if the government will introduce a Special Resource Tax as suggested by Gavoka, overseas companies will not invest in our country and there will be no new employment opportunities for the locals.