April 2008 Archives
Faint warnings (for now at least) of the possibility of a "broadband tax" to pay for the public service programmes put together by commercial TV stations.
The proposals are being put forward by the Office of Communications (Ofcom), the regulator for telecoms. It is included in their latest public broadcasting review. Click here to read the pdf, if you must.
So Ofcom thinks it's a good idea to introduce a tax to pay for such programmes. In their words,
It might be possible to introduce levies on providers not currently part of the formal public service broadcasting model, such as broadcasters, equipment sales, internet service subscriptions or UK online content providers.
Interesting how they use the less aggressive word, "levy", to describe what is in essence, a tax.
Needless to say, this "levy" will not be borne ultimately by the internet service provider. Rather, it will be passed down to the poor consumer, who will have to pick up the tab for whatever passes for "public service" programmes in dumbed-down Britain today.
What rot. Now I have nothing against public service programming - some of the programmes are quite good - but I fail to see why the average broadband user should be made to pay for programmes for which he does not care. If these public service programmes provide value, surely it shouldn't be too hard for them to find some commercial sponsors, and leave the poor taxpayer alone. If, on the other hand, they can find no advertisers or sponsors for their wonderful programmes, then perhaps we are all philistines who do not know what is good for us. Forcing us then to pay for such programmes would not be right, as we obviously do not value them enough to watch them. But perhaps Ofcom does not care whether or not we watch; they are simply satisfied if they can part us from our money.
Protests are mounting over the abolition of the 10% rate. Even Government ministers and high-ranking Labour Party members are joining in the criticism of the Government.
Gordon Brown will probably calculate that it would be too embarrassing to do a U-turn and keep the 10% rate after all. Even so, he will probably feel he has to do something to give the impression that he cares about the lowest earners and pensioners who will be most affected by this measure. This is my prediction: the announcement of a benefits package "providing targeted help to the most vulnerable in society". Therefore, more tax credits. In other words, more form-filling, more bureaucracy, more complexity, more waste.
It would be easier simply to raise the tax-free allowance to, say, £10,000, thereby ensuring that the lowest earners get to keep most of their income. However, don't hold your breath.
The 2008-09 tax year begins today, with loud cries of protest over the abolition of the 10% tax rate ringing in the Government's ears. Technically speaking, the 10 tax rate still exists, but only for "savings income", i.e. interest and similar income. Employment and pension income will be taxed, initially at 20%, and then at 40%.
The basic rate is reduced from 22% to 20%, however, this is small comfort to the lower earners who will be hit hard by the loss of the 10% rate.
Will the Government change its mind, and keep the 10% rate after all? Not such a far-fetched idea; this is, after all, a Government whose tax policy consists of blunders and U-turns. The Finance Bill is currently going through Parliament, so until it receives Royal Assent in mid-July, anything is possible.
The Finance Bill was published last Thursday - all 443 pages of it. I had a brief, crazy idea to print out the Explanatory Notes, but quickly gave up the idea on seeing that they ran to 1148 pages!
So much for simplification.
The Bill and Explanatory Notes can be downloaded here. (Very large pdfs - you have been warned)
