The actor, who is of Samoan descent, filmed his final scenes as Elijah Johnson late last year, and Australian viewers will see the character make his exit in April.
Writing on Twitter yesterday, Laga'aia alleged that he was axed by producers due to his ethnicity.
His comments came after actor Firass Dirani made a public call for TV producers to start reflecting the "different flavours and different cultures" of Australian society.
Laga'aia tweeted: "Hats off to you Firass Dirani, for a call to stop commercial network producers casting only white actors. Only on Australian screens. Shame!
"As someone who lost his job on H&A because they couldn't write two ethnics that weren't together, I'd like a chance to ply my trade freely."
A spokesperson for Network Seven, which broadcasts Home and Away in Australia, strongly denied the 48-year-old's claims - insisting that Elijah's story had reached a natural end.
The representative told the Herald Sun: "Jay's comments are offensive. We have great regard for Jay and his work on Home and Away during the last two years.
"It is insulting to suggest that Home and Away is racist. His character's storyline reached a natural conclusion."
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