Telephone Tax Dropped in Proposals to Fund Rural Internet
Saturday, June 26, 2010 21:02A portion of the BBC licence fee is set to be used to help pay for the construction of high-speed broadband networks in rural areas.
George Osborne said the Con-Lib governement would not introduce the former Labour administration’s plan for a £6 annual tax on users of fixed-line telephones to part-finance new broadband infrastructure in rural areas.
Instead, the coalition is preparing to help pay for superfast broadband networks in the countryside by using a portion of the BBC licence fee earmarked for assisting the transition from analogue to digital television.
The government rejected the telephone tax contained in Labour’s Digital Britain white paper. However, about £800m is coming from the licence fee over five years to help elderly and vulnerable people buy digital TVs or set-top boxes before the analogue broadcast signal is turned off in 2012, and not all of the money is expected to be spent.
The anticipated digital switchover underspend of £350m by the end of 2012 has been earmarked by the government for two broadband projects. Some money will help finance the government’s commitment that all homes should get broadband download speeds of two megabits per second.
Other digital underspend funds will used for three pilot schemes that will look at how best to extend superfast broadband networks to rural areas.
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