The recently announced 2025/2026 National Budget in Fiji, dubbed an "expansionary budget" by Prime Minister Sitiveni Rabuka, introduces several significant economic adjustments aimed at easing the cost of living and stimulating growth. A key measure is the reduction of Value Added Tax (VAT) from 15 percent to 12.5 percent. This decision, while difficult for the coalition government, was made with the clear objective of benefiting the populace by reducing their daily expenses.

Prime Minister Rabuka acknowledged the financial implications of this VAT reduction, noting that each percentage point represents a substantial loss of $100 million in government revenue. Despite this, he affirmed that a thorough analysis confirmed the government's ability to absorb this reduction, deeming it a worthwhile sacrifice for the greater public good. Alongside the VAT adjustment, the budget also includes a 3 percent pay increase for civil servants, a move that is expected to further support household incomes and stimulate consumer spending. Additionally, the budget outlines the removal of certain duty protections, which could have implications for various sectors of the economy.

Beyond immediate relief measures, the 2025/2026 National Budget also details considerable investments in critical infrastructure and innovation initiatives. Prime Minister Rabuka anticipates that these strategic investments will be pivotal in driving both short-term and long-term economic growth. He highlighted that such expenditures are expected to foster increased investments across the nation and generate new employment opportunities. Ultimately, these budgetary provisions are projected to have a profound positive impact on the lives of citizens, enhance national infrastructure, and significantly improve mobility, connectivity, and the overall social fabric of the country.