Praneeta Prakash 
Effective from August 1st there will only be two rates of Value Added Tax says Finance Minister, Professor Biman Prasad.
The good news for all Fijians is that the 21 items that were zero-rated will continue.
To this list of zero VAT rating, the government has added prescribed medicines as well, increasing the list to 22 items.
The items on zero VAT will include flour, rice, sugar, canned fish, cooking oil, potatoes, onion, garlic, baby milk, powdered milk, liquid milk, dhal, tea, salt, soap, soap powder, toilet paper, sanitary pads, toothpaste, kerosene, cooking gas and prescribed medicines
Prasad says the supply of all other goods and services effective from 1st August will attract a VAT rate of 15 percent.
“15 percent VAT is not new. It was payable on goods and services between 2011 and 2015 except on six basic food items, it was zero. Therefore 15 percent is not a new measure.”
Prasad says they have to make the right decisions and fully understand the expectations of the people particularly on basic food items.
He says that we have to bite the bullet but in a few years, all of us will discover that it’s a magic bullet that may give us short-term pain, but result in long-term gain.
He adds these measures will generate additional VAT collection estimated at $446 million for government.
