The highly controversial 50p per month broadband tax has been scrapped.

The broadband tax would have been applied to all landline telephones and cost 50p per month (£6 per year) and was expected to help raise around £170m a year to help pay for next generation fibre broadband to rural areas but Labour have scrapped it at the last minute before parliament is dissolved next week ahead of the General Election that is due to take place on May 6th.

It is not financially viable for the likes of BT and Virgin Media to install fibre broadband to some rural areas where they would not make a return on their investment and is the reason that the government wanted to provide funding. There is currently plans that 90% of the UK should have access to superfast broadband (50Mb or above) by 2017.

The Conservatives are apposed to the broadband tax and if they get into power would instead look to use part of the BBC licence fee to help with the funding required for the roll out of broadband to rural areas.

One big sticking point was the fact that the broadband tax would be used to help fund the next generation broadband roll out to rural areas which would account for less than a third of the country yet people all over the country would be forced to pay the tax yet see no benefit themselves from it.
Some households who may have more than one telephone line would be charged on each telephone line they hade, even if it was left unused.

Although the broadband tax has been scrapped for now, if Labour do win the General Election on May 6th then it is likely that they will re-introduce it and get it passed.