[Update and merge] 50p landline tax shelved

in principle i agree with this levi but am deeply suspicious of the gov ,any gov ,in dealing with private companies to fulfill promises made to the voters
i can almost hear the companies who will carry out the work raising the cost of doing these works ,what cost X pounds last year will be alot more expensive post announcement ,for no good reason apart from the fact that the work has to done and the gov is going pay so it's blank cheque time
i would be alot more happy if the guv researched the cost properly i.e compared past prices to the quotes they will get
working with local authority housing regeneration as i do i am only to aware of how much prices shoot up as soon as government funding is mentioned
as long as the tax payer doesn't get fleeced by a load of suits with brown envelopes i am all for this scheme as it will drag the uk into the 21st century

[brundles]

I agree with the concept of a universal basic level of service and that as with the other services we take for granted (despite grumblings and complaints), some form of tax is the only way to achieve it. I'm just a bit suspicious about how that's going to be achieved at who's expense/profit.

Looking at agendas of the two key players involved...

We have uk.labour.gov - looking for a nice report to show they're forward thinking with current technologies and expectations and perhaps see this as a handy way to try and connect with the techno-youth and sway a few votes in next years election.

In the second corner, we have BT - the only company that is able to (obliged to as pointed out) provide service nation wide but doesn't want to spend the money themselves as it's not profitable. That said, I suspect that if the service was better they would see higher revenues from those areas so having somebody else pick up the tab is ideal.

Virgin meanwhile, who are in the process of upgrading their minimum service to 10 meg, will see bugger all (excuse my language) of this money for that reason (I'm sure BT will strongly object to the tax being used for expansion rather than upgrade to minimum level).

As already posted, nothing has been said about how the tax will be distributed but I'm extremely suspicous about it.

[AndyCambs]

As far as I am concerned, it's simply another way of taxing people by HMG - probably paying for more dubious on-demand films for certain "honourable" members...

[nodrogd]

The plot thickens !!

Leaked documents are suggesting the tax will be "per line" and not "per household" and will be VAT chargeable. The tax will also apply to the new generation fibre as well as copper lines.

Story in the TIMES

[bonzoe]

Having been with NTL/VM for a number of years and paying by my subs for VM's fibre network why should I have to subsidise BT's failure to modernise? I left BT because their Internet access from home was a joke.

BT have made vast profits in the past - where did they go?

If this goes ahead, I hope that VM get to keep all the levy they are forced to collect from their customers.

[Robisme]

Originally Posted by yorkshireborn

loony labour at it again

im led to belive its a levy on copper lines ie BT

you wait until the crazy tories get in,(if they do) then you will see stupidity second to none

[AndyCambs]

Originally Posted by martyh

untill it is no longer 50p

it won't take long for the gov to realise that 50p is no were near enough to raise the money needed

Exactly the same was said about the Air Passenger Duty - Airport departure tax which started out as only £5 per person.
With the delayed changes planned for next year - for long haul this goes up to £120.

[noel43]

Originally Posted by Chris

I think you guess wrongly. The idea of a levy like this is to ensure a minimum level of service is available to everyone, regardless of the current availability of the service or how they currently use it. Providing that service is expensive - so expensive that it is not practical to force only those whose line needs upgrade work to pay for it. In the same way as everyone pays for schools, hospitals, roads and the BBC through a variety of taxes, licences and levies, regardless of whether they use those services or not, everyone will shoulder the cost of Britain's broadband upgrades.

edit

Look at it another way: if you were exempt because you're already on a super-fast cable network, wouldn't all those who already have fast ADSL also be exempt?

I.E. Another TV tax (sort of).

[Kymmy]

How can it be a TV tax?? It's only valid if you have a land line.. If you ust have for example VM TV then you won't pay the 50p a month

[Ignitionnet]

Originally Posted by Chris

The money that is raised with this levy will be spent on bringing the minimum data speed up to 2 meg on those lines that cannot already support it. In essence, a lot of money being spent in a few poorly-served, mostly rural locations around the UK. Your cash is going to upgrade my phone line. That may sound unfair, but it is simply what happens with every penny of tax you pay. It is spent where and when it's needed, and it is not needed anywhere on the Virgin network, as that network is already capable of far in excess of 2 meg.

This levy is not, in any way, related to the 2Mbit USC. It's to increase availability of 'super fast' broadband services. VM and BT between them will offer the 'next generation' services to about 60% of the population, this tax is there to increase that to 90%.

Putting it another way it's highly likely this will do precisely nothing for you Chris, it being targetted at those semi-rural areas that aren't urban enough to have cable or be viable for BT's NGA upgrades and those rural areas close-ish to urban areas.

Northern Ireland are doing some stuff. Chances are that last 10% will need to do it themselves with local authority support.

[BenMcr]

Well this confuses things!

http://www.theregister.co.uk/2009/12/11/broadband_tax/

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."

Interesting ... that could mean people who have VM TV but a BT phone line get clobbered twice, seeing as VM makes the phone line available to the house as a standard part of the cable run from the street cab, even if the sub has never expressed any interest in using it. I can't believe that was what the Treasury intended. It looks to me as if all they're actually trying to do is to close off loopholes. Stand by for fireworks and further 'clarification'.

[Ignitionnet]

Yes they have plenty of stuff to work on, however not having the VM phone line active is the same as not having the BT line active. It may run to your home but if you're not paying a line rental on it there'll be nothing to add a tax to.

[nodrogd]

Originally Posted by Chris

Interesting ... that could mean people who have VM TV but a BT phone line get clobbered twice, seeing as VM makes the phone line available to the house as a standard part of the cable run from the street cab, even if the sub has never expressed any interest in using it.

Consultation document does cover this point:

"3.7 There are some difficulties with this general approach due to how some retailers provide services to their customers. Virgin Media provide broadband services over a co-axial cable but standard voice services over a separate copper line where other providers would just use a single copper line for both voice and broadband services. BT will also face similar issues where fibre is overlaid on copper wires. Government’s intention is to ensure that there is no double liability under these circumstances."

[BenMcr]

But is that saying if you have a bit of wire connected to your house you will pay the tax or not?