It is a tax whatever you call it

AN OFFER by the Commerce and Employment minister to buy the chief executive of Sure a dictionary for Christmas because he needs to know the difference between a tax and a charge might have the required element of festive pantomime but does not address the underlying issues.

AN OFFER by the Commerce and Employment minister to buy the chief executive of Sure a dictionary for Christmas because he needs to know the difference between a tax and a charge might have the required element of festive pantomime but does not address the underlying issues.

Whatever the minister’s reading of his Concise Oxford, a compulsory contribution to state revenue, levied by the government on workers’ income and business profits or added to the cost of some goods, services, and transactions is a tax.

And it will be paid for, if the telcos are to be believed, by their customers because the 2% levy on spectrum-related activity will simply be passed on to them.

In other words, this is a telephone tax that will exclusively hit mobile users, who already pay significantly more than people in the UK.

Those are the same customers that the C&E minister in other utterances says are being penalised by the high charges of the telcos at the same time as he was pledging to drive down the cost of connectivity.

Yes, that’s related to broadband rather than 4G but people just want to be able to use their phones for calls and data at the lowest possible price and when the next generation overtakes 4G, landlines could become obsolete. Except they won’t be subject to telephone tax but mobiles will.

C&E’s contention is that spectrum is a valuable and limited resource and thus needs to be managed by government via charges but is content to leave the broadcasters alone on the basis that their services are provided for free.

Those who have just been fined £250 by the Magistrate’s Court for not paying the BBC’s compulsory TV tax through the licence fee might have a view on that claim.

The other problem is that, despite what C&E insists, this is a government levy on consumers because it bites on the telcos’ 4G-related revenues.

If there is a case for restricting spectrum consumption C&E hasn’t made it and that in any event contradicts its complaints about expensive connectivity.

From the States supposed business champion, this is simply a clumsy raid on telco profits which islanders will end up paying.