Due to the financial pressure faced by our national airline, Fiji Airways, Minister for Finance, Esrom Immanuel confirms the tourism industry has come on board to support airline and has broadly supported a temporary 5 percent tourism services tax on all hotels and tour and cruise operators with an annual turnover of $2 million or more for the next 12 months.
The revenue generated from this 5 percent tourism tax will be ring fenced and fully directed to Fiji Airways.
The industry has broadly agreed that the burden of the tax will be largely absorbed by the hoteliers and tour & cruise operators and not passed on.
The 5 percent tourism tax will be effective from 1st September 2026 and is expected to generate around $70 million for the airline.
Immanuel says recently the airline has been under some financial pressure following the substantial price increase in aviation turbine fuel and at a time when the airline was still recovering from the massive financial losses registered during the pandemic.
He adds Government as the major shareholder and given the strategic importance of Fiji Airways will support the airline with the planned $200 million Government guarantee that will be brought to this Parliament soon.
In this budget, they are extending the loss carry-forward provision for the airline from the standard 8 years to 15 years and waiving fees and charges amounting to around $10 million for the next 12 months.
They are also working together with other key stakeholders including Fiji Airports, Air Terminal Services, Civil Aviation Authority of Fiji, Fiji National Provident Fund and Fiji Development Bank to help ease the financial pressure on the airline.
The government is also working with the investor community to fast track and support investment in adding additional hotel room capacity.
The major hotel investments will add around additional 5,500 rooms with these hotel projects valued at over $3 billion. Of these 5,500 rooms, around 1,400 are in construction stage, 2,500 rooms in pre-development stage and around 1,600 rooms in conceptual stage.
The Ministry of Tourism and Civil Aviation is allocated a budget of $75.8 million in 2026-2027.
Tourism Fiji has been allocated $41.7 million, including $33 million for marketing. As global travel conditions become more uncertain, Tourism Fiji is re-strategising its marketing efforts to ensure Fiji remains competitive and delivers greater value from tourism.
https://www.fijivillage.com/indepth/2026-2027-national-budget-aca663/
https://www.fijivillage.com/indepth/2026-2027-national-budget-aca663/
