Small businesses in IT could be hit by broadband tax

25th September 2009

The government is to implement a new £6-a-year broadband tax on users of internet services before the next general election, it has been announced by a leading cabinet member.

Treasury minister Stephen Timms said the tax, which will equate to a 50p-a-month levy, will fund future plans even though it has faced stiff opposition from the Conservative Party.

Mr Timms explained that the government is aiming to make high speed networks nationally available by charging this fee, with the next-generation fund helping on a number of fronts.

It is hoped that the levy will be used to fund the government's target of bringing super-fast broadband to 90 per cent of British homes by 2017.

However, Michael Phillips, the product director of Broadbandchoices.co.uk, said the tax would unlikely affect the total cost of the "mammoth undertaking" that is the plan, stating that the tax is simply seen as unpopular.

He continued: "This is just another body blow to customers that have already seen the majority of telecoms suppliers significantly raise line rental charges this year."

In a recent survey of SMEs for Connect, the two most important benefits of outsourcing were guaranteed response times and allowing in-house IT staff to concentrate on more strategic issues.ADNFCR-1071-ID-19379808-ADNFCR