Fiji Budget Aimed at Cost of Living Reduction

The 2025–2026 National Budget, unveiled today by Deputy Prime Minister and Minister for Finance Hon. Biman Prasad, places a strong emphasis on reducing the cost of living for ordinary Fijians.

The government has announced a sweeping $800 million Cost of Living Package that includes a series of targeted relief measures aimed at easing daily expenses for households across the country.

At the core of the package is the reduction of the Value Added Tax (VAT) from 15 percent to 12.5 percent, a move the government says will make essential goods more affordable.

Other major initiatives include a 10 percent decrease in bus fares and a 3 percent salary increase for all civil servants.

The budget also features increases in social welfare payments and targeted support for low-income households, along with duty reductions on selected goods.

The total projected government revenue for the new financial year stands at $3.9 billion, while total expenditure is budgeted at $4.8 billion.

This results in a net deficit of $886 million.

Significant funding increases have been allocated to key ministries and state agencies. The Ministry of Education will receive $847 million, up from $778 million last year, reflecting the government’s continued investment in the education sector.

The Ministry of Health sees a substantial rise in funding from $451.8 million to $611.6 million, signaling efforts to improve health services nationwide.

The Water Authority of Fiji will receive $284 million, an increase from $225.9 million, while the Ministry of Public Works receives an allocation of $800 million, up from $721.4 million. The Fiji Roads Authority has been allocated $388 million to continue infrastructure development across the islands. The Fiji Police Force budget rises to $240.3 million, from $226.8 million last year, while the Fiji Corrections Service increases to $62.5 million from $57.8 million.

One of the only decreases is seen in the allocation for the Republic of Fiji Military Forces, which drops slightly from $169 million to $168 million.

Public reaction to the budget announcement appears to be positive as we await reactions from the Opposition.