Feeds

BTo slaps AOL UK over broadband

AOL UK bites back

  • alert
  • submit to reddit

Internet Security Threat Report 2014

AOL UK has reacted angrily to claims made by BTopenworld that it has "done the least of all the major players in the UK market to advance Broadband Britain".

The comment was made by BTopenworld CEO Alison Ritchie in a letter to Paul Boateng MP, Financial Secretary to the Treasury, concerning AOL UK's current exemption from paying VAT.

Ms Ritchie claims the tax loophole - estimated to save AOL UK around £40 million a year - is "tantamount to [a] subsidy of £4.50 per customer per month…when it [AOL] finally launches a broadband service".

Ms Ritchie continued: "Given typical broadband margins this is a huge sum that could enable AOL to become the dominant retail provider of broadband access. It is clearly perverse for the government to prevent a genuinely competitive market at this important juncture, particularly when the advantage is being given to a US-based company which hosts key activities outside of the UK and EU."

However, the attack has angered AOL UK which has hit back claiming that the remarks are "laughable".

A senior spokesman for AOL UK told The Register: "The apparent claim that AOL has not played a part in the creation of Broadband Britain would be laughable were it not seemingly made by a serious company in correspondence with the UK Government.

"These apparent claims are even less warranted given that AOL has worked very closely with BT in recent weeks to help refine the development of mass-market broadband provisioning systems," he said.

This latest row between two of Britain's leading ISPs comes as BTopenworld ups the pressure on the Government concerning AOL UK's exemption from paying VAT.

Last month HM Customs & Excise, which is responsible for VAT ruling and collection, published its review of the matter. It concluded that AOL UK will have to start charging UK customers VAT from July 1, 2003, bringing it into line with British ISP rivals.

But BTopenworld claims this simply isn't good enough. In the letter to the Treasury Ms Ritchie said she is "very disappointed at this outcome" and that she is "seriously concerned for the potential damaging effect on competition in the UK market".

Furthermore, she said that if AOL UK registered for VAT in a "comparatively favourable jurisdiction such as Madeira" then other UK ISPs including BTopenworld may follow suit.

BTopenworld's threat is the latest gesture in a campaign designed to force the authorities to close the tax loophole that favours AOL.

Last year Freeserve threatened to move its operation to Algeria to avoid paying VAT. ®

Related Stories

EU closes AOL UK VAT loophole (but not yet)
Freeserve goes legal in AOL VAT spat
'If AOL UK paid full VAT it could fund heart transplants'
Freeserve threatens to move operation to Algeria

Providing a secure and efficient Helpdesk

Whitepapers

Choosing cloud Backup services
Demystify how you can address your data protection needs in your small- to medium-sized business and select the best online backup service to meet your needs.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.