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back to article Broadband tax of £6 per year to fund rural fibre rollout

The government plans to impose a 50 pence monthly levy on every phone and broadband line to fund the rollout of fibre to rural areas, it was announced today. The measure, which will mean city dwellers subsidise faster broadband in sparsely populated areas where the economic case for commercial investment is weak, will come in …

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Yet Another Stealth Tax

Not content with raiding our pensions, re-re-introducing the fuel tax escalator, abolishing the 10% tax band for the low paid, and a host of other tax swindles, the Government is now slapping a 5+% or so tax on your telephone line on top of the VAT.

Gee thanks Gordon. I don't think.

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New Labour

New Tax. Nuff said

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How

How is a tax that is announced as a new tax in any way a stealth tax? I don't neccessarily agree with it (people living in rural areas are generally more affluent than those in urban areas so the whole idea seems counterintuitive; perhaps BT should just charge more for rural areas?) but to label it as a stealth tax seems a bit silly.

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copyright

Can I claim copyright infringement? must be worth a couple of pints

http://www.theregister.co.uk/2009/05/15/tsb_research/

£29billion

By Lan ser Posted Friday 15th May 2009 13:45 GMT

£29 Billion works out at £500 per person in the UK spread that out over the 10 years or so it's take to complete and thats £50 a year a single solitary british squid a week, sounds like a bargain to me for a 10gb connection.

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Stop

Statist Cnut gives State Aid to State Monopoly?

Is this what it seems to be, which is yet another subsidy for BT so that it can continue to pump taxpayers' money in to its shareholders pockets?

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oh, here we go...

pay 50p, a month to help people who don't have the advantages i do? But i don wanna, waaaa.

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Wurzel Tax

Why should we pay for these cousin-copulating rural bumpkins who eat hay all day? They won't even know what to do with the internet, they'll just dig up the fibre and sell it or eat it or something.

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Brilliant <\sarcasm>

OK, so the poorer, inner-city areas will now fund the more affluent, rural areas. Gee there's a logic I can't help but be unimpressed with. It's not my fault that some people choose to live in picturesque, exclusive (and, in their minds, elitist) areas, yet it seems to befall me and my ilk (i.e. hard-working, lower-paid tax payers) to fund their sodding broadband. Goodbye, Labour - yet ANOTHER cash-based reason to NOT vote for you at the next General Election.

Also, "Asked if he believed it would be a popular measure, he said: "We'll have to wait and see."" REALLY?!?! He's not got the slightest inkling that this 'measure' will be about as popular as Gary Glitter at a Kindergarten open day.

Idiocy. Utter idiocy!

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Stop

What?

We are being made to subsidise broadband for people, quite a lot of whom don't actually want broadband?

Please stop the planet, I want to get off now.

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Stealth tax

It is a stealth tax in that it is a tax in all but name. As far as I see it, if people who live in rural areas want or need broadband they can pay for it themselves. I, like most of the other people who will be subsidising this shambles without benefiting, live in a town where I can receive a perfectly decent internet connection, albeit paying through the nose for line rental already.

If people want broadband they only have to move. Otherwise, make them pay for it and don't force yet another unjustified price hike on the rest of us!

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What return will I get on my investment?

I suspect I will get nothing, and all this infrastructure will be given to BT for free.

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My Gran will be really happy.

I'm sure she'll be super keen to fund the next generation of super-fast broadband.

she's always complaining that with out fibre to home her current 22mbps is just not fast enough for her torrents to download at the same time as running apache server to to distribute her content to the other people in her sheltered housing.

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Laughable

Can't say I'm overjoyed at the idea of my taxes being used to fund a broadband USO, however to have them used to delivery next generation services to the arse end of nowhere gets up my nose in no uncertain terms.

Presumably next will be a tax to get a metro/underground network to every town and city after all it can't be fair that I have one close to me here, I just chose to live in the city and give up all the things someone in the sticks takes for granted like space and clean air in return for these conveniences. Silly of me really could have it both ways once Labour tax my backside.

I guess removing the business rate on fibre optics in ducting to stimulate a fibre optic rollout isn't going to happen, Gordon enjoys raiding our collective pockets far too much to actually drop a tax to improve services.

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another tax to pay

getting taxed on everything now.

cant even die without paying tax!

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What about mobile broadband

This government has no idea on IT.

The 3G carriers are trying to expand data coverage and encourage usage, with HSDPA cat 10 users will have connection speeds of 10.8 MB.

Why go to all the trouble and great expense of laying a fixed line to the doorstep?

Wake up to mobile comms.

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My mum will be pleased

My mum is 92 and has the phone as a lifel inon her pensione. Computers are a closed book. She'll be delighted to contribute to me getting more than the 750kb/s I get - so fair don't you think?

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Anonymous Coward

Final Third

There's some mixing of metaphors going on here - the 'final third' relates to those people who never go online, the 'digitally excluded', whether by choice or due to lack of resources, not the percentage of people who simply can't access the net. Current gen fixed line broadband coverage is something over 98%, even more if you consider 3g etc.

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Anonymous Coward

And???

What about those who are just about receiving 2mbs (although it drops on average twice a day), are we going to be bypassed... I know I am pushing my luck here, what with living 10 mins from the M25, I know, what am I thinking, sorry, I should just be happy with have electricity.

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Coat

Hmm .....

Am I the only person who thinks that providing universal broadband Internet is solving the wrong problem? And that we should be concentrating instead on making sure that Internet access simply never becomes a necessity in the first place?

Instead of introducing broadband so that people in rural areas can benefit from Internet-only shopping deals, for instance, why aren't we insisting for businesses to make their goods available at the same price in bricks-and-mortar stores for the benefit of non-computer owners?

Nobody should be obliged to own a computer. Making people dependent on toxic, proprietary technology in order to live their everyday lives is tantamount to privatising the Law of the Land.

Oh well, back to my little shack in the woods .....

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M7S
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@Tom 15

"people living in rural areas are generally more affluent than those in urban areas "

Cobblers.

Its just harder for Channel 4 journalists to spend a night posing as a down and out with a hidden camera in rural areas. There's more than enough poverty out here and the cost of living is higher in many ways. Next time someone in London moans about public transport, at least you've normally got some that normally runs more than twice a day and comes close than three miles to your house.

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Jeez likeit !

wouldnt mind if they would actually do the bloody work

but i think as we all know they will tax us and then do a study in two years saying we dont want it anyway so they wont be installing it but the expensive planning did the managers well in the meantime .. oh and by the way the goverment will be keeping the leftover money

Let me be the first to disagree I WANT IT NOW !!!!

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Unhappy

Oh ... great... thanks NuLabour...

I love how NuLabour treats my bank account like their piggy bank. When they are finished giving my taxes to their Banker friends, their other friends in the broad band business want some cash as well, so NuLabour decide to dip in and grab some more cash from us all. Wonderful.

Its not as if we don't pay (waste) enough money on taxes already ... but no, now they have to dream up some more reasons to just take more money from us.

Maybe NuLabour wants better broadband in the country because they are getting ready to retire to the country, now they have robbed us all mercilessly for years.

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The benefits

"The benefits we believe will be enormous," Carter said. I expect to BT they will be.

What is the real difference between this and pre-privatisation BT?

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A Shambles

Though not unexpected.

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Anonymous Coward

More affluent country areas?

What, like Devon, Wales and Scotland? Are you people nuts?

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Happy

Handy for your 2nd home

Thinking of getting a rural retreat with that city bonus? Put off by the lack of broadband?

Worry no more - problem solved, courtesy of the taxpayer.

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Hypothecated tax

Technically speaking this is hypothecation of a tax - or "hypothetical dedication" in full. That is money raised by taxation for a particular purpose - the TV license is another example. Historically the Treasury hate them - they much prefer all the money to disappear into a big pot so that they can spend it. The good news about this sort of thing is that at least the money will be spent on the stated service (assuming that admin costs don't get out of hand).

To be brutal about this, it's a rural subsidy. It already goes on - postal services to rural areas are subsidised by deliveries into urban ones. Rural telephone lines cost a great deal more money to provide than urban ones, for the same reason that broadband is slower on the former (in general). Lines are longer, more poles/holes per telephone line, more capital expenditure per line, more places where there can be faults and less revenue. There's a reason why companies target their services at the locations they do.

Frankly, if you want rural services at comparable prices to urban ones, then some form of cross-subsidy is inevitable. You can either make it explicit (by such things as levies) or you can bury it in the price tag to everybody else via universal service obligations.

The real challenge is the next generation broadband - with Ofcom mandating wholesale prices at not much above costs (when finance costs are added in), then it's very difficult to work out how a wide-scale infrastructure uplift will be funded. As it is, the roll-out will be patchy and concentrated in those areas where it is cheaper first.

Nb. - this won't be the last. The next one will no doubt be payphones. Mobiles killed the market for these and, if people still want them, then they are going to have to be financed some way. It will be interesting to know if Ofcom will tackle the mobile industry here - they get a very easy ride on termination charges where they are allowed to slap on charges about 5 times their costs whilst fixed line operators are allowed just a fraction of a penny per minute. Mobile phones are, to a considerable extent, subsidised by users of fixed lines...

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Sold everyone out to "the industry"!

They have also sold everyone out by offering to supply names of serial copyright infringers to the rights holders directly.

We all know the gov, OFCOM and the media industry can be trusted to play fair and get their facts right first time!

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oooh you city slickers!

We rich elitist country dwellers, or penniless bumpkin hayseed village idiots according to the commenters above, are not all millionaires like the London City guys who nearly broke the country and needed billions in bail-out money.

We ordinary town or country dwellers earn a helluva lot less than those with city weightings and would like to use the internet as much as you guys who think milk grows on milk-trees. Oh, and I wear a tie to work, spent years in IT support, can use phones and stuff and have a television at home. Nor am I being subsidised by someone who thinks an Underground strike is the end of the world as we know it.

Let's pull together and complain about ID cards, Paris Hilton and BT profits from Indian call centres going to their shareholders

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Rural areas...

are definitely not affluent. Here I am in Shropshire, look out of my window into a village that is mainly council housing. This village is less than 2 miles from a mid sized market town. My 'broadband' doesn't go beyond 1.5Mbps. People saying this is the city funding the rural areas are wrong. It's just everyone funding BT.

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too little too late

So in another 11 years the country will have average speeds of 2 MBit, that is about what we needed 5 years ago.

This country is pushing itself (or being pushed by idiot politicians) into a 3rd world state.

Most of northern europe already enjoys speeds up to 100 MBit.

Also fibre to the cabinet is ok, but still provided a great copper bottleneck to the system....

how far is the cabinet is going to be the new 'how far from the exchange'.

I had a 24Mbit connection from Be a while ago, when i could not get more than 2, BT came and looked and proded the cabinet and told me that they had always had problems with the cabinet on my street...

Also, when this has been talked about before BT said it would be approx 20 Billion quid, isn't that about what has been thrown away on the NHS system .... so why can't it be funded by EXISTING taxes instead of new ones.

Its about time to move to the first world from this declining alcatraz of an island.

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Yet more tight-arse comments

The comments on Reg articles often amaze me in their selfishness, and this is yet another example. How can people begrudge so little money to give people a benefit that we all take for granted? No, people in rural areas aren't all rich, and of course it costs more money to connect them up. Without a nationalised provider giving a fixed-price universal service (as we had in the good old days rolling-out telephones), these people are never going to get connected.

What else do you object to? Should people who live in the countryside pay more to get their post delivered? Or what about their electricity? Maybe the council shouldn't bother building any roads for them until they pay ten times the road tax? Sheesh... what is it about living in London that makes you all into selfish twunts who value nothing but money?

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Not ‘every’

You make it sound as if Virgin Media customers could be walloped twice. The report specifically refers to a cable operator’s telephone line, not the broadband-delivering TV line. So, it looks like those with Virgin Media cable broadband but no telephone line would escape the supplement.

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Get Carter!

Carter also answers Andrew Orlowski's question today "Britain losing radio habit?". AM and FM would be killed off by 2015.

Overall, if Carter were implemented, would it be case of never so many troughers in the corporate-fascist regime benefitting so much from one policy thrust at the expense of so many?

And let's not forget another corporate beneficiary - this "broadband tax" looks a lot like a test run for a blanket revenue tax for the record companies.

Talk about troughing politicians is one thing, but Carter looks like a plan for a guaranteed drip-feeding. Update: just hearing Carter on radio (FM) and unsurprisingly he sounds indistinguishable from a zanu liebore politician.

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tax

I don't mind paying tax, what I do mind is paying money through the government to service providers to do what they should have been doing anyway!

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Selfish twats

There are some really selfish and ignorant people posting here!

If they want broadband then move to the city? WTF? People living in the countryside are more affluent? Crap! Perhaps if we're talking about some parts of the home counties, but I'm fairly sure that the majority of people living in Northumberland or the Highlands and Islands of Scotland or deepest, darkest Devon would disagree.

Perhaps all us city dwellers should refuse to pay for all those rural roads that we never drive on, too. Perhaps we should refuse to fund the few remaining cottage hospitals that we've never even seen, let alone needed.

On the other hand, maybe those poor bloody farm labourers would like back that portion of their taxes that's funding all those feckless and work-shy inner city scum and providing a safety net for all those overpaid city workers that are losing their jobs!

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Paris Hilton

Hidden Agenda

Come on boys and girls, get with the real story behind this.

Not content with shoving ID cards on us all Labour now plan to stick a web cam in every home. Only to get the decent piccies they want they need a network pipe with the capacity to collect the information.

The sooner we get shot of this lot the better. can't someone send them a packet of swine flu?

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Bloody cheek

So BT etc who have been creaming in the profits for years from over selling the same bandwidth to as many people as possible and blaming us when we try to use it. Now expect us to pay from them to extend their service so they can rip even more people off.

Amazing not only do I now have to pay for bandwidth I don't get, I'm also going to have to pay so someone else can get limited broadband and the ISPs are going to sit back and enjoy the extra profits.

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Taxes

I think the idea is that the tax will work like fuel tax. The suppliers set the price according to what the think the market will take, then the government take a chunk of that. If the tax didn't exist then the suppliers' profits would be higher; the price would not be any lower. This works because supply is somewhat limited.

The Great British Public have been voting in favour of indirect taxation for the past 30 years, Labour have just carried on where the Tories left off. It would be interesting to see what would happen if someone campaigned on the promise of 'No Stealth Taxes, just a huge Income Tax'.

I was shocked when I lived in Sheffield 10 years ago to meet people my age who were baffled and intimidated by computers. We cannot afford to have children growing up today who aren't comfortable with using computers and accessing the internet. Private enterprise has so far failed to provide decent internet access in rural areas and are disinterested in doing so in the future. Rural broadband could be a good long term investment for the country.

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Heart

Rural

I am "happy" to report that there is a number of financially disadvantaged people in the village I live in. We're a few miles from the M40, so not geographically rural, but we get a maximum of 500kbps downstream on ADSL and the exchange is not unbundled and regardless of what Virgin Media's marketing team think - we're not in their cable area. Only Vodaphone gives us any mobile signal - and that's poor (one bar) - so mobile broadband is out. Digital TV is not great either - it keeps dropping out.

The village is developing "social housing" and there are several sites in the village being considered by the parish council. You need a car to get anywhere which is expensive enough as it is (road charging would damage the ability for people to live here). The nearest farm shop is a mile and a half away and the nearest town is a few miles beyond that.

I think that believing that people living in the country are generally more affluent is a little naive. I also think that believing research that says that people believe that Internet access is as important as electricity is also naive.

I can see how it could help some of my older neighbours for online shopping with delivery - that's vital for them now we don't have local post offices or amenities. Also local government changes mean access to their web sites for support services is critical. As applications continue to appear online, then the digital divide will continue to get wider.

Many of the people living here, particularly the poorer ones, have been in the village for generations and are now tied to the area by bonds of caring for elderly relatives, or because they cannot afford to move. They live in ex-council houses now run by a Housing Association. Perhaps not the image of the affluent country-set imagined by some urbanites.

Because my local exchange will probably never be unbundled, I already pay £180 per year more than people in cities with access to "free" "up to 24Mbps" broadband - just to get 500kbps.

My lifestyle allows me to get by with that capacity and I can afford it. I'm not that bothered about IPTV and I don't stream content or use P2P applications. Lucky me.

To those people in the city complaining about subsidising connectivity improvements in rural areas, the money that I pay today is not being invested in new services for rural locations - it is going to subsidise the excellent service enjoyed by people in the cities. Thanks for your support.

I am happy to pay a bit more for my copper service to make sure that my poorer neighbours can get access to a reasonable suite of communication services. I think it will help prevent rural communities being increasingly seen as the sole preserve of the wealthy who are able to afford to drive and fend for themselves.

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Anonymous Coward

What did these rural people do to get a phone line?

Did they pay or did BT provide one for free?

Anyhow, I digress. A Phone tax. great. And once everyone has broadband, the BBC will be allowed to collect licence fees for internet connected people. And, as everyone will be connected, the "non-user" will be conveniently forgotten (just like non-watchers nowadays) and you will fall into the usual 2 camps...Licence fee payers and Licence fee evaders.

We will all learn to fear that knock on the door again.

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@M7S

That may well be true, but remember you do still have the right to move to an area where there is a bus service that's reliable and close to your home, as well as a broadband connection.

The point here is that no-one 'put' you where you live. No-one 'forces' you to stay there. No-one (and I apologise for the bluntness here) commenting here really cares about you. Nothing personal, really.

But I think I (and I daresay others) have a right to be affronted by a bloody 'tax' levy so folk living outside of a service area can have access to a service we already pay not an inconsiderable amount of money for.

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Our Great Leader...

...said that alongside water and electricity, broadband is one of life's essentials.

Here's an experiment for you. Take 3 cabinet ministers and deprive one of them of water, one of electricity and one of broadband and see which one dies first. If necessary take the whole parliamentary nu-lab party and repeat until absolutely sure, or all are dead, however long it takes.

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@Fraser

Bog off.

Why the hell should I pay for something for someone else?

If the underpriveleged country bumpkins wanted more than the 512kb/s they can get now, they'd have bought satellite broadband. Or lots of amalgamated BT Home Highway lines ;-)

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Do people still use landlines?

From what I've read those who have a home phone are to pay the tax - So if you got a mobile as your main phone and say cable internet you're not gonna pay?

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QQ moar

waaah waaah went the townies....

Because without this, country folks haven't been been funding your super duper fast broadband for years which they have no chance in hell of benefiting from now would they, and it wouldn't really have continued now would it.?

Kind of like the crap loads of council tax we pay for the priviledge of NOT receiving the services townies do, higher fuel prices than in towns, and we get to have only one bus a week 3/4 mile away... post that arrives at 2 in the afternoon, heck ho wants it in the morning eh.. Higher fuel prices out here too, because with no bus services having a car is flipping luxury of course, you don't really need to leave the house do you ....... *snip*

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Subsidies eh?

Having subsidised those bonus-stealing, expense-stuffed, twin-home city dwellers with their calf-skin pouched iPhones tucked into the gloove boxes of their Lexus GSes for the last 10 years, the possibility of getting a portion of it back to my 480Kbps-on-a-good-day, no-mobile-coverage hovel just three miles from the main Exeter to Plymouth trunk route fills me with glee. Stuff you all.

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Anonymous Coward

Jam tomorrow

I live in the countryside beyond the reach of conventional broadband, so ought to welcome this, but there is a good chance I will be dead by the time this scheme is actually built. I'll certainly be over 70. But I will probably be around to pay the taxes for it, the next however many years.

Remember how they stopped calling the car license fee the "road fund tax" once people realized that the money wasn't being spent on the roads? The government just got their foot in the door to tax telecoms forever, and the rate will go up and up.

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Anonymous Coward

They better not trough this

in the grand scheme of things it is not much, I would actually prefer they ask for donations and pop up a link to businesses and individuals donating money, for this and this alone.

Then the money should be tracked, every penny of it.

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superhighway vs country lanes

This is a drop in the ocean compared to the cost of providing roads to rural areas! And it's in the same category as the 'phone.

But my requirement isn't high-speed fiber. Just a *guarantee* of ADSL service levels, and most importantly unmetered access. OK with fiber I could run a server from home, but the fact I have to host it elsewhere isn't exactly major social exclusion.

Using the road analogy, country lanes are just fine!

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