‘NBN tax’ gets ACCC approval, could bring price-hike for some fibre internet users

The ACCC has ruled that it’s fine for the burden of funding the NBN’s Regional Broadband Scheme (RBS) to disproportionately fall on customers of superfast fibre-internet services that were rolled out privately.

The ruling is likely to mean that some internet users in new housing estates and inner-city blocks of flats could face their ISP levying an ‘NBN tax’ on their internet service. This could take the form of an extra monthly fee of around $7. The tax is intended to help subsidise the costs of the government’s rollout of NBN infrastructure (including fixed wireless and satellite components) to regional parts of Australia that would otherwise not be financially viable.

An Australian Competition and Consumer Commission (ACCC) chairperson justified the tax in a statement, saying that “the regulated prices based on the NBN prices may not have allowed these network providers to recover their reasonable costs if they were also required to absorb the proposed RBS charge.”

How does this affect consumers?

The fee will only affect superfast internet services that aren’t technically part of the NBN, which have often been rolled out privately in regions and situations that wouldn’t have otherwise been serviced. These ‘non-NBN’ fibre networks have primarily been installed by service providers, and include TPG’s Sydney and Melbourne fibre-to-the-basement service, Telstra’s South Brisbane and Velocity Estates fibre network, and other smaller installations put in place by providers such as Vocus, Opticomm and LBN Co.

Although the ACCC has shared figures detailing how the RBS fee will affect providers’ wholesale costs , it’s currently unclear as to what form this tax will take when it’s passed on to consumers. A report by the Bureau of Communications Research last year recommended that consumers should pay an additional $7.30 a month in 2018, moving up to $8 by 2022, which reflects the ACCC’s recent statement that the cost will adapt in line with NBN prices.

This move aims to prevent these non-NBN providers from having to absorb the costs themselves. The ACCC has also specified that it won’t apply to smaller providers with fewer than 12,000 customers, where it’s fear the increased burden could be crippling.