With the passing of the 2023/2024 National Budget, implementation is the key, and regulatory bodies like the Fijian Competition and Consumer Commission and Consumer Council of Fiji must be very attentive to the transition of taxes and duties and strongly ensure that these benefits are passed on to the consumers.
USP economist, Doctor Keshmeer Makun says the budget projects a total expenditure of $4.3 billion and a revenue of $3.7 billion with a net deficit of $639 million, which is equivalent to 4.8 percent of GDP – a reduced deficit compared to past budgets.
Doctor Makun says with GDP expected to increase, the debt ratio is projected to decrease to 79.3 percent - consistent with the government's objective to reduce the debt to GDP ratio to 60 percent by 2030.
The economist says there are a number of good initiatives announced in the budget.
He says for instance, contrary to the World Bank's recommendation, VAT on essential goods have been kept at zero rates with an additional item, which is prescribed medicine, added to the list. Doctor Makun says there is a reduction or removal of duty on various consumer goods to ease the burden of the cost of living on households and increase social protection allowances.
He says there is also a commitment to reviewing minimum wage and civil service pay and streamlining government services and processes, amongst others.
However, he stresses the implementation of the budget is as important as the budget itself.
The USP economist says the initiatives announced can only have an impact if it is implemented appropriately.
He also says not only that but because if the budget is not effectively implemented, there is a tendency of misappropriation of resources.
Doctor Makun says this is where the whole of the government and innovative approach and regulatory bodies play a major part.
He says it is crucial that government departments and those serving there understand these initiatives and policy changes so that they can respond to people efficiently.
The economist says the ministries at all levels should remove inefficient bureaucratic processes and save valuable costs and time.
In terms of passing benefits of reduced taxes and duties to consumers, Doctor Makun says businesses need to be ethical and socially responsible too about it and ensure that they are reflected on supermarket shelves.
He says normally, downward prices are sticky, but this should not be the case with respect to VAT and duty reduction.
