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Government To Fine Non-NBN Users With Broadband Tax

Updated to include comment from the Office of the Hon Paul Fletcher MP

The Federal Government has reintroduced plans to tax non-NBN operated fixed-line services to fund future costs of the network alongside a bill that establishes the NBN Co as the default fixed-line operator in Australia.

Users of NBN-equivalent fixed-line services, both business and residential, will be smacked with a $7.10 monthly fee for the crime of not using the National Broadband Network.

Under the scheme, the levy will charge carriers $7.10 per month for each premise with at least one high speed fixed line connection on their networks.

Despite listing the package bill on the Daily Notice Paper for the House of Representatives on the morning (28 November) they were to be tabled, communications Minister Paul Fletcher reintroduced the Telecommunications (Regional Broadband Scheme) Charge Bill 2019  following the bills automatic lapse at the close of parliament before the 2019 election.

According to his office, the Minister had made mention of the levy on 9 October at the CommsDay Melbourne Congress, a peak telecommunications event that attracts nearly 300 delegates from the telecom sector.

Shadow minister Michelle Rowland spoke the following day stating quite clearly in her speech, ‘this Government has not presented a proper plan for the sector because many of its objectives have been missing, contradictory or misdirected to begin with’.

In referring to the proposed tax Minister Rowland said, ‘[this government] as we speak — wants to introduce a $7 to $8 per month broadband levy whose specific purpose is to prevent fixed-line competition with the NBN’.

‘We afford industry the respect of taking positions that are consistent with what we say,’ said Minister Rowland in opposition to its underlying purpose.

When the bill was first introduced the federal government gave the NBN Co an extra three years to pay back its loan of $19.5 billion for building the network.

Tasmanian Labor Senator Catryna Bilyk said last August, ‘given the current state of the economics of the NBN, it’s difficult for Labor to oppose this tax outright but we do consider its imposition to be highly unfortunate’.

The minister’s office, however, supplied instances where Labor MP’s ‘did not oppose the bill outright’ but within these statements were mentions of disapproval of the tax, as highlighted by Senator Murray Watt on 13 August 2018, ‘we think that some amendments can be made that will improve what the government is putting forward’.

Furthermore implied by Senator Catryna Bilyk, ‘we do consider [the bill’s] imposition to be highly unfortunate… we will seek to improve the legislation’.

When the bill was first tabled it did not have the support of Labor, forcing the Government to implement an amendment introduced by the ALP to cap the levy at $10.

The government hopes the tax will prevent future calls on the budget or public funds to finance the NBN, which has already been estimated to cost more than $51 billion, despite early estimates of $29.5 billion.

In addition to the NBN Co receiving funds from the levy, the Australian Competition and Consumer Commission (ACCC) and Australian Communications and Media Authority (ACMA) are also set to receive part of the NBN-tax to cover the cost of enforcing it.

‘The money collected from the base component of the charge would be used to fund the losses NBN Co incurs in constructing and operating its fixed wireless and satellite networks’ said Minister Fletcher in parliament.

A part of the Regional Broadband Scheme which has been designed to cover the satellite and fixed wireless networks in rural Australia.

Fletcher claims the bill would ‘provide a transparent and fair funding mechanism’ for the NBN Co into the future considering the cost of such a network, though did little to assess the impact this tax would have on non-NBN users.

While the bill is designed to encourage users to switch to the NBN (a poor excuse for what had been initially proposed by the Rudd Labor Government), it does so through penalty rather than an incentive.

Fletcher suggests the bill provides ‘greater certainty to telecommunications carriers’ to ease the burden of NBN-transitions for smaller carriers.

Similar to the Medicare levy, the federal government is essentially fining people for not following its mandates.

If the NBN service were efficient and functional, as was promised in the original Rudd Labor plan, then the tax may be considered worthwhile in pushing people to switch services.

Unfortunately, many users are still screaming at their routers asking NBN Co to get it working already, as currently Australia is ranked 50th out of 148 countries for broadband connection speeds, behind the likes of Tunisia and Saudi Arabia.

When it was first proposed in 2018, Michelle Rowland said between 240,000 and 450,000 customers could be charged an extra $84 a year.

‘The Turnbull government is seeking to pass a broadband tax that is seeking to raise nearly half a billion dollars over the next decade,’ in order to protect the NBN Co which was estimated to lose $9.8 billion over 30 years.

Seems like the Liberal run government is running out of ways to fund their failed version of the NBN.

Can we go back in time and get NBN Kevin 07′?

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