Tuesday, 17 April 2012

LTE tax

The UK government budget document for 2012-13 purports to reveal how we'll be taxed in the coming year, but it makes no mention of its planned LTE spectrum auction. I've seen several predictions of how much money the auction may raise for the Exchequer; the smallest that I've seen (in the Financial Times) is £2bn. While that 2bn will be paid directly by the businesses that will be bidding, ultimately it will be paid by UK mobile communications users: the businesses have no other source of funds.
And while LTE will, at least at first, be a product mostly for the well-off and able, the funds will be extracted across the GSM operators' entire customer base; in other words, pretty much the whole UK population. whether HMG has the right to sell spectrum that it never paid for is debatable. But it seems irrefutable that an LTE auction would leave the government substantially better off, at the expense of the population at large. £2bn is, in tabloid headline terms, equivalent to a tax of £32 on every man, woman and child in these
I've written at greater length about the arguments for, and alternatives to LTE
auctions, on page 23 of this month's Land Mobile magazine.

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