Feeds

Tories would scrap 50p broadband tax

'As soon as possible'

Boost IT visibility and business value

A Conservative government would scrap the planned 50 pence per month tax on every landline - which the current government plans to use to subsidise faster broadband in rural regions - "as soon as possible", according to the shadow culture secretary Jeremy Hunt.

The levy hasn't yet been implemented but is a cornerstone of the current government's Digital Britain strategy. Ministers estimate it would raise £175m per year fund to pay for fibre in sparsely populated areas which BT believes do not justify a privately-funded network upgrade.

Former technology PR man Hunt said in an interview with the Financial Times today that the tax would be immediately binned after the next election if the Tories win.

BT currently has so far announced plans to improve broadband speeds for 40 per cent of the country by 2012 with a mixture of fibre to the cabinet and fibre to the premises deployments. The investment is targeted at urban areas where the return is likely to be greatest.

Hunt was not quoted as offering an alternative funding mechanism for "the final third" of broadband upgrades, where multiple economic assessments have found there is no case for private investment in rural regions without some form of government intervention. The relevant Conservative spokespeople were not available this morning.

One controversial alternative to subsidies would be to simply accept a new digital divide between town and country, although it would be an unlikely policy from David Cameron's neophile Tory party.

Indeed, in a speech in January, Cameron said a Tory administration would aim for ubiquitous high speed broadband within ten years. He didn't give any substantive details of how this might be achieved, but said his government would facilitate upgrades "by letting it be known that it will encourage and support the private investment required to develop the network".

The incumbent government meanwhile intends that communications providers will collect the levy on its behalf via a surcharge on line rental, so Hunt's plan to scrap it is likely to be privately welcomed by industry.

However Stephen Timms, the minister responsible for delivering the Digital Britain strategy, last month pledged to impose the levy before the next election. Firms could therefore be forced to bear costs of setting up and then within months dismantling a tax collection apparatus if both politicians get their way.

The latest the next election can be held is 3 June 2010, and the Queen's Speech, when Timms plans to introduce the necessary legislation, is on 18 November. ®

The essential guide to IT transformation

More from The Register

next story
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Don't call it throttling: Ericsson 'priority' tech gives users their own slice of spectrum
Actually it's a nifty trick - at least you'll pay for what you get
Three floats Jolla in Hong Kong: Says Sailfish is '3rd option'
Network throws hat into ring with Linux-powered handsets
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
New Sprint CEO says he will lower axe on staff – but prices come first
'Very disruptive' new rates to be revealed next week
US TV stations bowl sueball directly at FCC's spectrum mega-sale
Broadcasters upset about coverage and cost as they shift up and down the dials
Trans-Pacific: Google spaffs cash on FAST undersea packet-flinging
One of 6 backers for new 60 Tbps cable to hook US to Japan
Tech city types developing 'Google Glass for the blind' app
An app and service where other people 'see' for you
Canadian ISP Shaw falls over with 'routing' sickness
How sure are you of cloud computing now?
UK mobile coverage is BETTER than EVER, networks tell Ofcom
Regulator swallows this line and parrots it back out at us. What are they playing at?
prev story

Whitepapers

5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.