Broadband tax scrapped in 'wash-up'
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The Tories forced the government to drop a 50p-a-month tax on every landline last night as ministers made deals to get their budget plans through before the election.
The levy had been intended to pay for rollout of fibre optic cables in rural areas.
The Conservatives hailed the outcome as a "victory for consumers". The measure had been the centrepiece of last year's "Digital Britain" report.
The government folded because it is under pressure to pass remaining legislation this week in a bout of legislative horse-trading known as the "wash-up". Opposition parties use the scramble to win concessions, although it is unusual for the government to drop parts of the Finance Bill.
The Tories want market forces to have more time to spread faster broadband technologies. They have suggested that part of the BBC licence fee - the surplus from the digital switchover - could be diverted later.
The government had planned to use the broadband tax to create a £175m-a-year subsidy pot. BT has claimed there is not enough demand in about a third of the country to justify a commercial rollout.
Both parties aim for ubiquitous fibre optics by the end of the decade.
The Treasury was also last night forced to abandon plans to raise the duty on cider, announced only two weeks ago in Alistair Darling's last budget of this Parliament. ®
COMMENTS
Political dogma
Oh you people, you never fail to surprise me. I suppose you all buy the '£6 billion out of the economy' claptrap, too.
National fibre to the premises project is already well underway, courtesy of BT, which will (theoretically) allow speeds up to 100Gbps. It is being funded by people buying services from BT, that's how the private economy works. Demand brings supply. How in the hell do you expect HMG, masters of waste, to help?
And, no, 50p may not break the bank, but when you add it to all the other 50p that Messrs Brown and Darling have siphoned from your pockets over the last decade it adds up to a hell of a lot!
Go on, hit that thumbs down button. Each one makes me shed one more tear.
You LOT aRE wORSE THAN daily FAIL!!!! readers
Good god, whats going on here then?
When this tax was announced these message boards were full of people hating it. Why should granny with just her landline pay for rich bankers to get fibre to their holiday cottages.??? You could smell the outrage.
Now someone proposes scrapping it and theres a paradox for the small minded twerps on these boards. Cos that someone is the Conservative party. Yes the nasty tories that mummy told me to hate cos there used to a be a nasty lady called thatcher and she woz evil and made the entire country redundant and privatised everything and spent the money on tory party holiday homes and tax breaks.
Pathetic. Fancy having so little brain matter that you chose the sides in a sensible discussion based on the colour of tie the PM wears.
Labours answer to everything is increase Tax. That is singularly the only solution they have ever had to any problem. Maybe you should look into alternatives, like raising money elsewhere? Or spending less of it???
Morons.
50p?
And you're sure it would have stayed at 50p, are you?
Could well have turned into £5 a month, incorporating an anti-piracy, help out the UK music industry tax and pay for a super duper, spy on everyone's communications mega-database tax.
We all know these things start of at one price, but once Government gets them in, there'd be a bit of "mission creep" and you'd soon end up paying a lot more.
Most of road tax doesn't pay for the up keep of roads, go figure.
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