A new report out today confirms that 400,000 people are denied access to superfast broadband services as a result of a ‘stealth tax’ imposed by BT Openreach. The TalkTalk-commissioned report looked at the potential benefits to consumers and businesses of new regulation currently under consideration, and found that if the wholesale price for Openreach’s superfast broadband product was properly regulated, the price paid by consumers would drop by an average of 5.5% - leading to an overall consumer benefit of £8.1billion by 2025.
These lower wholesale prices would allow BT’s rivals to cut their own prices and pass through savings to customers and still have enough money left over to increase investment in their networks and customer service. The price cut would mean that take-up of superfast broadband would surge, with around 400,000 people able to afford the service for the first time. These would be the most hard-pressed consumers and emerging small businesses – the very people who stand to gain most from better connectivity.
Charlie Elphick, MP for Dover and Deal, former tax lawyer and vocal campaigner on corporation tax avoidance, said: ““It is astonishing that BT has taken £1.7 Billion of public money to roll out this product - while pricing it above the means of ordinary people. It’s a stealth tax on consumers and yet another example of how big corporates take advantage of regulatory loopholes to line their pockets. Ofcom needs to get a grip and act now to prevent BT abusing its market power and inflating prices.”
TalkTalk has long called for wholesale price reductions, promising to pass on savings to consumers. With Ofcom finally taking a long, hard look at this regulation, now is the perfect time to ensure as many people as possible can enjoy the full benefits of the UK digital economy.
A TalkTalk spokesperson said: “If Ofcom finally takes action and forces Openreach to charge a fair price for superfast, we can make it cheaper for everyone, and give more people access to faster, more reliable internet. The longer the regulator lets BT impose a stealth tax on superfast customers, the more of these benefits will be lost.”