THE Fiji Revenue and Customs Authority has exceeded its target collection by $30.1million for the six months ending June 30, 2013.
Against the forecast of $797.3m, the total revenue collected as at June 2013 was $827m.
FRCA CEO Jitoko Tikolevu attributed the resounding performance to a number of factors, in particular the improved consumption level.
“We have seen a pattern of direct correlation of tax cuts and increased domestic VAT collection, which has been averaging at around 19 per cent growth over the six months.
“By cutting taxes, the government has indirectly injected about $53.1m in the economy through increased disposable income and FRCA has established that a large portion of disposable income has been spent leading to increased tax take.”
Mr Tikolevu said FRCA had also seen improved capital gain tax collection and this in some ways also reflects increased consumption spending in the real estate sector.
Compared to the same period last year, revenue grew by 11.7 per cent, much higher than the projected 2.7 per cent GDP growth for 2013, the statement said.
The revenue growth is also higher than that recovered over the past 10 years which was 8.4 per cent. It reflects a significant 4.3 per cent growth in tax revenue for a one per cent growth in the economy.
Mr Tikolevu said the performance against the forecast had been historic and FRCA had rarely seen revenue exceeding forecast in the order of more than $30m by the first half of the year.
“In fact, between 2004 and 2012, FRCA’s January to June collection has exceeded the forecast by an average of $1.9m but the 2013 performance as at June is actually about 15 times better than the average of the past 10 years.”
He said on average, there was 60 per cent collection required in the second half of the year.