High Court up­holds VAT Amend­ment

Fiji Sun - - Front Page - Source: DEPTFO News Feed­back: jy­otip@fi­jisun.com.fj

The High Court of Fiji has dis­missed an ap­pli­ca­tion for con­sti­tu­tional re­dress filed by the Data Bureau against the Fiji Rev­enue and Cus­toms Au­thor­ity and the Min­is­ter for Econ­omy chal­leng­ing the con­sti­tu­tion­al­ity of Sec­tion 72(A) of the Value Added Tax De­cree (“De­cree”), amended in 2015. The pro­ceed­ing was spe­cific to the VAT re­duc­tion from 15 to nine per cent an­nounced by the Min­is­ter for Econ­omy in the 2016 Na­tional Bud­get.

Sec­tion 72(A) states that if the per­cent­age of VAT de­creases, a reg­is­tered per­son must sell goods and ser­vices at a price which re­flects the ac­tual per­cent­age of any VAT de­crease. Fail­ure to com­ply will re­sult in a fine not ex­ceed­ing $50,000 which must be paid within 21 days of the no­ti­fi­ca­tion. The Data Bureau was found to have charged 32 cus­tomers for credit checks from the pe­riod of 1-16 Jan­uary at rates that did not in­cor­po­rate the VAT re­duc­tion from 15 to nine per cent as an­nounced in the 2016 Na­tional Bud­get. For this breach, the Data Bureau was fined $25,000 on Jan­uary 22. Af­ter fail­ure to pay the fine within 21 days, the Data Bureau in­curred an ad­di­tional penalty of $100,000, as stip­u­lated by the De­cree. The High Court ruled that Sec­tion 72(A) was not un­con­sti­tu­tional.

“This is a ma­jor vic­tory for Fi­jian con­sumers, as it af­firms the Govern­ment’s abil­ity to pe­nalise those busi­nesses who fail to pass on the sav­ings of any re­duc­tion to the VAT or on cus­toms du­ties. “Con­sumers are now bet­ter pro­tected from busi­nesses seek­ing to with­hold po­ten­tial sav­ings, and that in­creases the pur­chas­ing power of the or­di­nary Fi­jians who need it most,” said the At­tor­ney-Gen­eral and Min­is­ter for Econ­omy, Aiyaz Sayed-Khaiyum.

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