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Broadband tax may not improve access. A proposed tax on broadband intended to fund next-generation networks could make high-speed internet access too expensive for many people.

Charles Dunstone, chief executive of internet service provider (ISP) TalkTalk, has argued that raising home phone bills by 50p a month for seven years could lead to more than 100,000 households being priced out of broadband services.

When comparing broadband prices, households would need to take into account the annual £6 tax on their telephone landline in calculating whether the service is affordable.

“This is an unjust and regressive tax on all phone customers which will subsidise mostly richer rural households that can afford high priced super-fast broadband services,” he said.

Mr Dunstone added that ISPs could also delay improvements to broadband networks in order to benefit from the public funding raised by the tax, when they might otherwise have invested in the networks sooner.

He pointed out that the private sector had achieved 99% broadband coverage nationwide and urged the government to let ISPs “drive next-generation broadband as far as it can”.

The tax was proposed in the government’s Digital Britain report, published in June of this year, and is intended to raise an estimated £1bn to improve the network and achieve universal coverage.

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