The new UK Government unveiled their new budget on Tuesday, which is their response to the economic downturn and the increased borrowing which happened as a response.
Most of it is debatable on a more personal level, but there’s one interesting paradox.
Books, magazines and newspapers continue to sold without Value Added Tax (VAT), which is commonly applied to purchases in the UK, and will increase from 17.5% to 20% from 4th January, 2011.
The reason for this is that all of these print materials are valuable sources of information and people should be access them without paying VAT – which I can understand.
But internet access does get VAT charged and will therefore be subject to the increase of 20% in January.
And yet, for a flat monthly fee which I can predict and budget for, I can access the biggest repository of valuable information in the history of the world, which is being added to at an unbelievable daily rate on pretty much every subject imaginable. Even discounting the 99% of content which may be skateboarding dogs on Youtube, that still leaves more valuable information than I will ever have the time to read and access in my lifetime, including the sites run by the UK Government.
Not only that, but access to the internet also allows more people to not only produce content, but also new businesses and business models which can fuel the economy – or to take part in existing job or freelancer markets to get work.
And there are savings for bigger, established businesses and organisations, as they seek to cut back on personal and telephone service and increasingly switch customer interaction to the internet – including a growing range of Governmental departments and services. And that’s in addition to the actual VAT bill itself.
After all, digital was a noticeable part of the election campaign promises for the first time, with a debate over funding a nationwide broadband infrastructure that can support high speed internet access, and I was pleasantly surprised to see that the UK Digital Champion appointed by the last Government, Martha Lane Fox, will continue under the new regime with the aim of aiding universal internet access to all as an enabling tool.
So either the money being raised and the challenge of cutting VAT from one part of telephone/TV/cable/broadband deals was too complicated, the money being raised is too important, or it just didn’t come up during the budget planning (I can understand that there may have been other immediate priorities). But surely if the Government is really serious about providing universal access to broadband internet to boost the economy and help business in Britain, lowering the cost of that access for everyone has to be a good starting point.