Reseller News

Four telco providers to pay 90% of $10M Govt levy

New draft detemination released
  • Leon Spencer (New Zealand Reseller News)
  • 22 October, 2020 10:50

Spark, Vodafone, Chorus, and 2degrees are set to collectively pay approximately 90 per cent of the government’s $10 million Telecommunications Development Levy (TDL) under a new draft determination on the allocation of payments levy.

The Commerce Commission has released its draft determination on the allocation of payments for the TDL for 2019-20, detailing the levy’s split among the country’s telco players. 

The TDL was established by legislation in 2011 and specified that, in 2020, the amount that telecommunications providers must contribute to the TDL would be reduced from $50 million to $10 million a year. 

The TDL is paid by providers earning more than $10 million per year from telecommunications services, including internet, mobile, and data services, with the government using the funds collected by the levy to pay for telecommunications infrastructure and services that are not commercially viable.

The legislation requires a draft determination to be prepared and for submissions to be allowed on the draft before a final determination is prepared, with ComCom required to prepare an annual TDL liability allocation determination.

The draft determination proposes that Spark, Vodafone, Chorus, and 2degrees, which on 22 October announced the appointment of Apple NZ's carrier manager Zac Summers as its new strategy chief, collectively pay approximately 90 per cent of the $10 million levy, with the remainder of the levy to be divided among other liable providers.

The amount each liable provider pays is proportionate to their telecommunications revenue, ComCom said.  

The Commission is now calling for industry feedback on the draft determination and will accept submissions until9 November. The final determination is expected to be released in December.