The VAT waiver on the Fiji Electricity Authority's fuel surcharge would not sustain the economy in the long term, says the president of the Fiji Chamber of Commerce Taito Waradi.

He said the recommendation would only serve as a short-term relief and the Government would lose much needed revenue.

Mr Waradi said the Government should find alternatives to fuel because the global fuel price would continue to escalate.

However, Consumer Council chief executive Premila Kumar said the Government should consider waiving VAT from FEA's fuel surcharge to provide some relief to domestic consumers.

Ms Kumar said the council was not asking the Government for a VAT waiver on FEA's existing tariff structure that is $0.22 cents per unit.

Rather, she said the council was asking for a VAT waiver on FEA's fuel surcharge only for domestic residential customers.

"For the Government to conclude that it will lose much needed revenue if it grants a VAT waiver is not correct,"she said.

"The Government is currently collecting revenue from the set tariff structure but with the introduction of the 30 per cent surcharge the Government will collect additional revenue through VAT,"said Ms Kumar.

She said it was equally important to note that domestic consumers were not able to pass on the fuel surcharge cost, nor were they able to recover VAT unlike the commercial and industrial consumers.

Ms Kumar said the trickledown effect of the 30 per cent fuel surcharge from commercial businesses and industries would make customers pay twice.

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