29 Nov 2010

Hundreds of jobs lost in Fiji spat over water tax

8:07 pm on 29 November 2010

Four hundred jobs have been lost in Fiji with the US company, Fiji Water, shutting its doors after the interim regime announced a massive hike in the tax on exported bottled water.

Last week, the interim regime announced in its 2011 budget the levy would increase to 15 Fiji cents per litre from the current rate of a third of a cent per litre.

Fiji Water's President John Cochran says the new tax is untenable and the company had no choice but to close.

He says the company contributes more than 70 million US dollars in export revenue and has employed 400 people.

A union source says the loss of jobs is a major concern, particularly in the region where the bottling plant is located, because there're few other employment opportunities there.

Mr Cochran says the country is becoming increasingly unstable and is a risky place to invest, but the company is willing to work through the tax issue with the Fiji government.

In 2008, Fiji Water shut down operations threatening the employment of 700 people.

That action prompted the interim government to drop a planned 20 cent per litre tax.

10 days ago, the Fiji interim government deported a US executive of Fiji Water, David Roth, for allegedly interfering in Fiji's domestic affairs.