The Labour Government’s proposal to put a 50p +vat per month tax on all fixed phone lines to help fund the rollout of next generation broadband services to 90% of the country by 2017 has been shelved at the last minute. The tax itself was widely disliked and had received stiff opposition from almost all quarters, though without it the Government has effectively erased its crucial Next Generation Access (NGA) plans.
The tax was part of the Government’s Finance Bill, which will now face a general delay until 18th May; crucially, after the general election. It’s still possible that a victorious Labour party might reintroduce it, though Conservative opposition, even in a hung parliament situation, is likely to mean that the 50p tax is now well and truly consigned to the dustbin.
In the meantime there will be an inevitable climate of uncertainty, though such weather is not to be unexpected around a general election year. Meanwhile the Conservative party recently pledged to use 3.5% of the BBC’s existing TV Licence fee (Digital Switchover Budget, estimated to be worth £130m per year) to deliver “100Mbps broadband across most of the population” by 2017, instead of imposing the 50p tax.