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Fibre companies hit as ComCom releases draft telco development levies

Fibre companies face a levy hike while the three majors will pay less
Annual telco levy draft hits fibre companies.

Annual telco levy draft hits fibre companies.

The Commerce Commission has released its draft of how much telco providers will pay towards the Government’s $50 million Telecommunications Development Levy (TDL) for 2018/19.

The annual levy, of around 1 per cent of telecommunications services revenue, is paid by providers earning more than $10 million per year for providing telecommunications services, including internet, mobile, and data services.

It is used to pay for telecommunications infrastructure and services which are not commercially viable, including the relay service for the deaf and hearing-impaired, broadband for rural areas, and improvements to the 111 emergency service.

Last year, Voyager and MyRepublic became subject to the levy while specialist research network REANNZ dropped out of liability.

This year (see table below), the draft determination provides that Spark, Vodafone, Chorus, and 2degrees will collectively pay more than 90 per cent of cost. 

The contribution of the top three would decline slightly year on year while 2degrees' levy would increase slightly.

However, the contributions to the TDL by Enable, Northpower and Ultrafast Fibre have significantly increased due to increased fibre uptake.

Enable Networks' levy would more than double year on year from $316,375 to $663,904 while that of Ultrafast Fibre would increase from $624,023 to $814,879.

The TDL was established by legislation in June 2011 and is currently set at $50 million a year but will drop to $10 million in 2020.

2019 draft levies.Credit: Commerce Commission
2019 draft levies.