Fiji Hotel & Tourism Association (FHTA) CEO Fantasha Lockington has raised concerns over a new five per cent tourism tax being introduced to support Fiji Airways.
Under the new tax, tourism and hotel businesses in Fiji with an annual turnover of more than $2 million will be required to pay an additional 5 per cent tourism levy to support the embattled airline from 1 September.
Like many airlines, Fiji Airways has been hit hard by rising airplane fuel costs.
The levy comes as multiple sources, including advisors, report a steep rise in travel costs to Fiji – a destination that won the hearts of Australians when it was one of the few local destinations to reopen to travel during the pandemic.
Speaking to Travel Weekly, Lockington said the new tax risks placing further pressure on operators already under strain.
“The Fiji Hotel & Tourism Association (FHTA) has noted the introduction of the 5 per cent Tourism Services Tax with concern,” she said.
“While the industry recognises the vital role of Fiji Airways in sustaining connectivity, visitor arrivals, and national branding, the levy risks adding further pressure to operators already managing higher costs,” she added.
Lockington, a member of the Australian Institute of Company Directors (AICD), acknowledged that many Australian travellers are already feeling the increased costs.
“For Australian travellers in particular, rising prices across accommodation, food, and services were already being felt. The industry remains committed to ensuring that Fiji continues to deliver – and even increase – the value for money that has long defined our brand.”
Lockington said measures to support Fiji Airways should “be designed with fairness, transparency, and consultation, ensuring Fiji remains an accessible, competitive, and trusted destination for our international partners and visitors.”
Australia remains a major source market for Fiji: in March this year, Australians accounted for 43 per cent of visitors, a 17 per cent year-on-year increase.
Deputy Prime Minister and Minister for Tourism and Civil Aviation Viliame “Bill” Gavoka has defended the controversial tax, noting it applies for only 12 months and that Fiji’s tourism industry would face greater risk if Fiji Airways were to falter.
“The future of the industry is dependent on Fiji Airways, and this year there’s a lot of bookings in the system for most of the hoteliers. If Fiji Airways does not come up and perform at its full capacity, all those bookings are questionable. They are under threat.
“So we want Fiji Airways to continue to function at its full capacity, and this is the way to do it, and the government is committed to this. It has been tabled in Parliament, and it’s only for 12 months from September. It’s not going to be forever.”
One of the most recent Australian visitors was Prime Minister Anthony Albanese to sign a major new defence treaty with Fiji after landing in the capital, Suva on Sunday night.
