Politicians condemn broadband tax plans
A committee of British politicians has attacked government plans to introduce a tax on all telephone lines to fund the expansion of the country’s broadband network. It said the tax was “ill-directed” and would put an unfair burden on people who would not directly benefit from it.
Under the proposed law, every copper landline (ie, not fiber-optic cable) would be taxed £6 (approximately $10 US dollars) a year, with the revenue being earmarked for subsidizing broadband networks in regions which telecommunications firms don’t consider profitable.
The politicians are part of the Business Innovation and Skills committee. This group looks are business issues generally and isn’t part of the scrutiny process for specific proposed laws. However, a majority of its members are part of the governing Labour party, meaning such direct criticism of the plans may have an indirect effect on whether officials revise the legislation.
As part of its report, the committee said the tax was unfair in two main ways. First, as a flat-rate tax it would be more of a burden for people on lower incomes, despite the fact such people are least likely to benefit from broadband availability.
Giving evidence to the committee, government minister Stephen Timms (pictured) said the proposed tax rate had been set low enough that it could be affordable to everyone.
The second committee complaint was that by only applying to people with landlines, the tax would be more prevalent among elderly people than youngsters. (That point doesn’t necessarily hold up as people who only have cellphones clearly can’t benefit from broadband at all unless they get cable.)
The committee also questioned the credibility of government claims that the money raised from the tax would be guaranteed to be spent on broadband provision and no other purpose. It argued that if the money did need to be raised, it made more sense and was fairer to simply build it into general taxation.
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