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Plan to reduce waste

Siteri Sauvakacolo
Thursday, August 07, 2014

THE National Federation Party said it did not see any connection between VAT revenue and expenditure to provide good roads and quality health services to our people.

Party spokesman Dr Sunil Kumar made the statement in response to the FijiFirst anti-VAT reduction campaign by candidate Dr Mahendra Reddy who said a reduction in VAT would reduce government expenditure on roads and hospitals.

He said this comment was flawed, adding the NFP would be guided by a medium to long-term infrastructure plans.

"NFP will reduce wastage of government financing through efficient checks and balances and ensure the productive use of government revenue," Dr Kumar said.

Dr Reddy, as part of his FijiFirst campaign, said VAT would not provide relief to the poor.

However, the NFP otherwise said it was true that there was no VAT imposed on tinned fish, flour and sharps, powdered milk, edible oil, rice and tea.

However, a typical poor household does not only consume these items.

A typical basket for any poor household also includes consumption of electricity bill, water bill, mobile phone recharge, frozen meat, bread, processed food such as noodles, transportation and entertainment.

FijiFirst said reducing VAT from 15 to 10 per cent would reduce VAT revenue by 33 per cent.

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