The Ministry of Works, Public Utilities and Transport has announced that there will be no increase in bus and taxi fares at this time.
Permanent Secretary Cama Tuiloma confirmed the decision is based on the fact that VAT is refundable.
He said the notion or argument that with the increase in VAT, there should be a corresponding increase in fares for buses and taxis, is wrong.
“The basis for that notion or assumption is not correct because Vat is refundable,” he said.
Mr Tuiloma said submissions for fare increases made by bus and taxi operators, are thoroughly considered before the Minister makes a decision.
“The procedures for those submissions are clearly stipulated under the LTA Act,” he said.
“That needs to be followed for proper consultations and all views to be considered before it comes to the Minister for a decision.”
The decision was reached after consultations held between the Permanent Secretary in the Prime Ministers Office Mr Pio Tikoduadua, Permanent Secretary Strategic Planning Peter Wise and officials from the Ministry of Finance.
The Land Transport Authority Chief Executive Officer Naisa Tuinaceva was also present at the consultations to provide more detailed information on other issues affecting buses and taxis.
He added Government has made several concessions in the 2011 Budget to allow bus operators to reduce operational costs.
“Government has made a number of concessions in the 2011 Budget announcement in terms of purchase of spare parts, chassis and for the procurement of new buses,” he said.
“That is assistance by Government and an opportunity for bus operators to upgrade their buses to better conditions and reduce operating and maintenance costs.”
Meanwhile, the Ministry is also dealing with other transport issues that have been brought to the attention of the LTA.
“Those issues are different from the VAT issue I have mentioned already, for instance, there is a request to look at the city routes in terms of fares to be charged, or in terms of taxi fare increase, these are to be done through the normal channels and procedures under the Act,” he said.
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