British broadband tax could take effect within months
The British government says it plans to impose a “broadband tax” before next May. If approved by parliament, as seems near certain, it would mean everyone with a phone line would pay £6 (approximately $10) a year towards expanding the broadband network.
Speaking at a debate in London today, Stephen Timms, the minister responsible for the government’s digital policy, said the legislation for the tax should be passed “this side of the general election.” That election will take place by May 5 next year at the latest.
The tax would mean that companies providing telephone services through copper lines must pay a monthly fee of 50 pence per customer. There hasn’t been any word from phone companies yet about whether they’d be prepared to eat this charge themselves or will add it on to customer bills.
The government says the tax, which should raise around $150 million to $175 million a year, will help fund its goal that “virtually all” homes should have access to broadband speeds of at least 2Mbps by 2012.
It doesn’t appear that the government is expecting the support of opposition parties. However, that’s unlikely to be an issue as the tax will be introduced part of the government’s forthcoming finance bill, which sets taxation and spending policies. It’s traditionally held that a government losing a vote on its finance bill would be finished, so there is virtually no chance of government politicians rebelling in the vote, even if they disagree on specific proposals in the bill.
As well as the usual debate over taxation in principle, two points of the specific proposals have attracted criticism. The tax would hit people who don’t use a computer at home, let alone subscribe to broadband. And the wording of the government proposals suggests that fiber-optic cable customers, who arguably get some of the best broadband services, would escape the charge.
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September 23rd, 2009
If they are going to charge £6 for an internet connection, they should be investing in the phone network for everybody. I live 2 miles away from my nearest telephone exchange and can only get a connection speed of 2MBps – which isn’t too quick these days. Everything is becoming more bandwidth intensive and yet I can’t speed up my internet any more. And we usually have at least 2 PCs trying to stream media.
They should not invest in providing an internet connection for rural areas and I’ll tell you why: WiMax is just around the corner. This is an option which has not been well explored, and I think it could work out cheaper to provide equipment to use a WiMax connection in the next few years. Let’s face it – whatever they put in place now which involves building better cable lines will take years to complete, whereas the WiMax transition is likely to come in the same period or before. It may work out to be more expensive, but I don’t think it has been explored sufficiently.
And I know this sounds selfish, but on the grounds the majority of people are going to receive absolutely no benefit of a ‘minimum of 2MBps’ connection, why should we all pay for the minority to have a better connection?