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Fiji water to pay additional $22M as water resource tax

Fiji water to pay additional $22M as water resource tax

By fijivillage.com
Wednesday 01/12/2010
Fiji Water is expected to pay an additional $22 million to the government as Water Resource Tax from next year after the increase in the tax from one third of a cent per litre to 15 cents a litre.

This is expected to boost the Water Resource tax revenue in 2011 as this year the total revenue through the tax was $0.5 million.

Meanwhile as Fiji Water recommenced operations in Fiji today, the questions that arose in relation to transfer pricing and other issues in relation to the true declaration of the value of a carton of Fiji Water exported to the US are yet to be dealt with.

Prime Minister, Commodore Voreqe Bainimarama has said that despite being a premium boutique water product, Fiji Water declares the selling price of a carton of water at $US4 while exporting it from here when at the same time other relatively unknown brands from Fiji like Aqua Pacific declare their selling price to the US market at $US10 a carton.

Commodore Bainimarama said Fiji Water sells its water to a US sister company and therefore is engaged in transfer pricing.

The question remains on what is the true value of a bottle of Fiji Water when it leaves our shores to the US.

FIRCA CEO, Jitoko Tikolevu said he will not make any comments on the issue at this stage.

Commodore Bainimarama also clarifies that Fiji Water has had a corporate tax holiday since its inception in 1996 until only two years ago and it has paid less than a million dollars in total corporate tax.
 
He said it is about time that Fiji Water pays a reasonable Water Resource Tax for extracting the natural water from Ra as it is reaping huge benefits from the sale of the product.

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