Government ministers are looking at a new internet tax if they scrap the licence fee.
A change could be coming soon to the licence fee, under Labour plans (Image: Getty)
Labour are considering slapping Brits with a new £11-a-month internet charge to replace the BBC licence fee, new plans have revealed. Under the proposals the Beeb’s whopping £180-a-year fee would be replaced with a cost added straight onto household broadband bills.
The Social Market Foundation think tank came up with the idea after exploring new models of funding the national broadcaster, which has seen a sharp decline in licence payers in recent years. In real terms the revenue from the licence fee has dropped by around £1.3 billion since 2017, according to the Guardian.
The sharp decline has been the result of successive government freezes of the levy and more and more people choosing not to pay it. Licence fee evasion has rocketed from 7% in 2012, to more than 12% last year.
Under the possible new Labour plan, a flat £11 tax could be added to internet bills even in homes where nobody watches live television.
BBC licence fee warnings (Image: Getty)
The Sun reports Labour Culture Secretary Lisa Nandy has already been in discussion with advisors about the £11 “Home Internet Levy”.
If the rate of the new tax stayed the same it would work out around £132 a year cheaper than the current £180 annual BBC licence fee. But unlike the licence fee, which see the corporation face rigorous debate every time it seeks to increase the funding model, it is not clear if the ‘Home Internet Levy’ would be subject to the same scrutiny.
A spokesperson for the Department of Culture, Media and Sport, said: “The BBC must be funded by a model that is sustainable and fair to all those that are paying it.
“Through Charter Review, we are looking at a range of options, including how the BBC can operate more efficiently, generate more commercial revenue, and how the licence fee could be reformed.”
Labour could be about to introduce yet another tax (Image: Getty)
Speaking to the Guardian, Abi Watson, from Enders Analysis, said the BBC had not “run out of money” but the fall in revenue from the public-service branch of the corporation meant it had “considerably less room to absorb further pressures or fund change”.
“The BBC has already reduced headcount, rationalised its estate and changed its commissioning mix,” she told the paper.
“Commissioned hours, excluding news and sport, are down 20% since 2016-17. Further savings increasingly mean decisions about output.”
A BBC spokesperson said: “Like many in the media industry, the BBC is facing considerable financial challenges, which is why we’re making significant cost savings across the organisation.
“The drawdown of cash reserves has enabled us to manage pressures on licence fee income while continuing to prioritise spending for audiences and invest in our digital transformation.”