Telstra hits out at government’s ‘NBN’s tax’

Regional Broadband Scheme levy too broad, telco argues

Telstra does not support the government’s Regional Broadband Scheme (RBS) in its current form, arguing that the levy is too broad in scope.

The government in June unveiled legislation to implement the scheme, which will impose a monthly, per-premise charge on carriers that offer superfast broadband services.  

The government has said that the money collected from the RBS would help make up for the losses incurred by NBN’s fixed wireless and satellite services.  

In a submission (PDF) to a Senate inquiry examining the RBS, Telstra argued that the industry levy “applies too broadly, is too uncertain in how it defines liability to pay and as a result will be difficult and costly for carriers to administer”. 

The telco said that it originally supported a levy on the basis of it being introduced to “create a level playing field and support the provision of rural and regional broadband infrastructure” by combating ‘cherry-picking’: Carriers rolling out infrastructure that competes with the NBN in areas offering a high rate of return, potentially undermining the business case for the NBN.  

“Under that approach the levy would only be payable by those networks that had infrastructure competing with NBN infrastructure: the levy would apply to networks ‘cherry picking’ the NBN,” Telstra said.  

“However, the RBS has been broadened into an industry tax applicable to all superfast broadband networks, regardless of whether they pose a competitive threat to, or create any revenue leakage from, the NBN business case.”  

The telco added that it objected to the levy covering the enterprise and wholesale market.  

“It was always envisaged that if nbn co chose to compete in the enterprise and wholesale segment it would do so on a competitive basis and would have factored this into its business case,” Telstra argued.  

The scheme should be “rebased” to be an anti-cherry-picking measure.

“Any additional funding required to support NBN infrastructure in regional and rural Australia should be funded in the same way as nbn co’s other infrastructure,” Telstra argued.

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