In a move which is certain to cause concern in UK government circles, a group of MPs have this week slammed the proposed broadband tax of 50p a year on each telephone line in the UK. This is a move which was expected to bring in around £200 million a year which was to be invested in the UK broadband industry. However, there are a number of concerns within political circles.
One of the major concerns is the fact that the £200 million in question has not been earmarked for any specific area of the broadband industry. This could lead to potential issues with regards to value for money and the chance that the money could become part of a larger government investment pool and lose its real value. Then we have the problem that many people who would be forced to pay the broadband tax may not see any benefit in the short, medium or longer term.
The alternative to a broadband tax would be further investment by the private sector but this could impact upon competition in the medium to longer term and possibly increase the cost of broadband in the UK. There is no doubt that the UK broadband industry is at a very important crossroads and how the next generation of broadband services are funded will be vital.