Feeds

Unused phone lines to be taxed for rural broadband

Skypers won't get away with it either

Next gen security for virtualised datacentres

Unused landlines will be taxed under government plans to subsidise rural broadband, and VAT will be charged on the new 50p per month tax.

"The duty will be payable on all local loops that are made available for use by an owner whether or not the lines are actually used," the Treasury said today.

"It will also be payable on all local loops regardless of whether the loop consists of a copper pair, a co-axial cable or a fibre connection."

Only means-tested households subscribed to ultracheap "social phone" services will be exempted.

A consultation makes it clear that every other landline, including those used exclusively to access the internet, will be taxed from October next year. The Treasury said the landline firms had complained exempting internet only line might hit their voice revenues.

"The duty has also been designed to include broadband services to address concerns that phone users may substitute to voice over internet protocol (VOIP) services such as Skype. This design means that users that choose not to take a phone service will still pay the duty," the consulatation explained.

The Tories are opposed to the tax and have said they would look to scrap it "as soon as possible" if they win the next general election, though have not made a firm commitment.

It's currently envisaged that the taxman will collect from the physical owners of local loops - mainly BT and Virgin Media. BT's wholesale division will pass the cost on to retail ISPs and phone providers, who the government envisages will pass it on to consumers.

"Some retailers may decide to include the duty as part of the line rental or overall package charge to customers, while others may choose to add it as a separate explicit item on the bill," the Treasury said.

Premises with more than one line will have to pay the tax on each. However, for Virgin media customers, where a "line" consists of a co-axial line for internet access and a copper wire for phone, only one levy will be applied.

The Treasury said it expects to collect £175m per year, allowing fibre-to-the premises and fibre-to-the-cabinet projects to bring faster broadband to 90 per cent of the country by 2017.

BT has said it believes there is will be a business case for commercial rollouts covering only two thirds of premises. ®

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
Three floats Jolla in Hong Kong: Says Sailfish is '3rd option'
Network throws hat into ring with Linux-powered handsets
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
EE: STILL Blighty's best mobe network, says 'Frappucino' Moore
Fresh round of network stats fisticuffs possibly on the cards here
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
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

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.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
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.
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.