Government scraps 50p broadband tax

A controversial tax aimed at helping every part of the country get superfast broadband has been scrapped by Parliament.

Labour had put forward the 50p-a-month broadband tax, which would have been applied to all households with a landline telephone, in a bid to raise £170m a year to help fund the implementation of next generation broadband in 90% of homes by 2017.

However it was scrapped as the Government tried to rush through the Finance Bill ahead of the General Election next month.

The news has been welcomed by the Tories, which were against the tax from the outset, and  by industry experts.

Michael Phillips, Product Director at, told TechEye that it was “good the tax had been scraped.

“Its not a great loss because the amount the Government would have raised through this tax wouldn’t have even scratched the surface,” he said.  

He said it would cost around £15 billion for next generation broadband and the tax would barely raise these funds.

“It was a badly thought of way to combat this problem and it fell down when it reached the parliamentary vote,” he said.

“It’s down to ISPs to provide the fund for this new framework and they should all be given a commercial incentive to do this.”

However, critics of the scheme should keep the champagne on ice for the time being. It’s likely that if Labour wins the election next month this tax could be reinstated.