Draft decision on contributions to $50 million levy

Draft decision on contributions to $50 million telecommunications development levy

The Commerce Commission today released its draft determination on how much 17 telecommunications providers will each pay towards the Government’s $50 million Telecommunications Development Levy (TDL) for 2017/18.

The Government uses the annual levy 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.

The levy, about 1% of telecommunications services revenue, is paid by providers earning more than $10 million per year from operating a telecommunications network, including providing internet, mobile, and data services to consumers.

Today’s draft determination determines proposes that Spark, Vodafone, Chorus, and 2degrees will collectively pay more than 90% of the $50 million levy. Voyager and MyRepublic will be liable for the TDL for the first time this year due to their growing revenues.

A copy of the draft determination can be found here.

The Commission invites submissions on its draft determination via email toregulation.branch@comcom.govt.nz by 5pm, 8 November 2017. The Commission expects to release its final determination in December.

Background

The Telecommunications Development Levy (TDL) was established by legislation in June 2011 and is set at $50 million a year until 2019. The Commission is required to prepare an annual TDL liability allocation determination in accordance with the Telecommunications Act 2001. The legislation requires a draft determination to be prepared and for submissions to be allowed on the draft before a final determination is prepared.

Voyager and MyRepublic qualify for the TDL as their telecommunications revenues now each exceed $10 million. REANNZ will no longer be liable following a High Court decision that it operates a private, not public, telecommunications network.

More information on the TDL is available on our website.