ComCom reveals each telco's share of the tab for $50m industry tax

Amy Adams: departed as ICT minister, but her expanded industry tax remains

UPDATE/Dec 7: The Commerce Commission today released its final decision for the 2016/2017 Telecommunications Development Levy (see table below).

There were no changes from a draft released on Oct 26.

The Commerce Commission has revealed its draft decision for the 2016/2017 Telecommunications Development Levy (see table below).

The $50 million a year industry tax, used to help pay for the Rural Broadband Initiative (RBI), was supposed to be scaled back to $10 million for the current financial year.

However, the outgoing National government extended it by another three years to help pay for its expansion of the rural broadband rollout (leading one industry insider to snark that then ICT Minister Amy Adams was "campaigning with other people's money").

The RBI 2 tender was won by a joint bid from Spark, Vodafone and 2degrees – although RBI I winner Chorus got a consolation prize in the form of a surprise top-up for the urban Ultrafast Broadband project.

Given it has no role in the second wave of the RBI, the levy is purely a drag for Chorus.

For RBI II winners Spark, Vodafone and 2degrees, it's a money-go-round, with their levy payments feeding their government funding for phase two of the rural rollout.

Incoming ICT Minister Clare Curran has been critical of elements of the RBI and UFB but, with Crown Fibre Holdings signing commercial contracts with Spark, Vodafone, 2degrees and Chorus last month to cover RBI II and the latest extension to the UFB, she has limited room for manoeuvre.


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3 Comments & Questions

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In 2012 Voyager reported they will hit 10M revenue, why are they not paying TDL?

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Market share in the table is interesting. For 2degrees to grow and obtain scale it must acquire Vocus NZ. No other options left.

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Interesting to see the levy is proportional to qualifying earnings yet Vodafone charges its customers $11.88 "telco levy contribution" per year ($0.99 flat-fee per month) - no attempt to make it proportional to its earnings per individual customer.

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