The Consumer Council of Fiji wants commercial banks to ensure changes in Resident Interest Withholding Tax, announced in the latest budget, are passed on to consumers.
Photo: RNZ Pacific
The Minister for Economy said that from the beginning of next month interest earned by an individual on $30,000 Fijian dollars or less annually will be exempt from withholding tax.
In the 2016-2017 financial year, the tax was cut from 20 percent to 10, but the Council found that banks in Fiji had failed to pass this on to consumers.
It said this caused immense frustration when consumers realised that their interest was still taxed at 20 percent.
The Council called it a blunder made despite the sophisticated technology and highly trained human resources available to banks.
It said banks must update their systems and ensure they do not fail consumers this time around.
The Council also called on consumers to exercise their rights and be vigilant by monitoring their statements to ensure they are not unfairly taxed.
The Council is also advising Consumers that under the new changes all senior citizens (55 years old or above) and pensioners who earn interest income up to $30,000 are eligible to apply for a Certificate of Exemption for RIWT from Fiji Revenue and Custom Services (FRCS) provided this is their only source of income.
Other funds exempted from the RIWT include the first $200 of any bank interest earned in a year and the interest credited to the account of a member of the Fiji National Provident Fund.
