Broadband: Proposed 50p Phone Line Tax

Posted on 30. March, 2010.

A proposal to introduce a 50p Phone Line Tax to fund super-fast broadband may push hundreds of thousands of people offline.

Labour's proposed phone line levy has raised strong objection from the Conservative party.

 

Speaking at the National Digital Inclusion Conference, Conservative Minister for Digital Britain, Jeremy Hunt MP said that although the Conservatives agree with the government that relying on private investment is the best solution, they don't think the proposed levy is the way to tackle it.

 

"It won't work because people are already extremely price sensitive. Figures have shown that up to 200,000 people would actually choose to disconnect from broadband completely rather than pay the phone tax," he said.

 

He went on to detail how his party proposes to fund the project alongside private funding.

 

"A levy is currently on the BBC licence fee, which was added to help fund the Digital Switchover. After the Digital Switchover is complete in 2012 we would then continue with this levy but use it to fund the next-generation plans.

 

"And the BBC support this idea, seeing as the iPlayer is one of the hungriest users of bandwith coupled with the BBC's aim to make their programmes accessible to all," Hunt said.

 

Price-comparsion site Moneysupermarket.com cautiously welcomed Hunt's comments.

 

"It's imperative the roll-out of 100Mbps doesn't deepen the digital divide with only urban areas able to get super-fast speeds," said Mike Wilson, broadband manager at Moneysupermarket.com.

 

"The government and Ofcom will need to ensure providers offer competitive packages. High speeds won't be as attractive if they're accompanied by a high price," Wilson continued.

 

What Do You Think?

 

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