Full Fibre UK Broadband Networks Face Sharp Fibre Tax Hike on Network Bills
The Government’s Valuation Office (VO), which has just become part of HMRC, appears to have begun hitting builders of fibre optic broadband networks with an increase in the rateable value (RV) of their fibre infrastructure (aka – Fibre Tax), which in some cases has hiked costs by up to around 30%. Not ideal given the well known strains in the sector right now.
Complaints against the business rates system for new fibre networks are of course nothing new, and it doesn’t help that a lot of the VO’s online documentation hasn’t yet been updated to reflect the latest 1st April 2026 change. For example, the VO’s Rating Manual for telecommunications fixed line networks (here) doesn’t seem to have been replaced, which means that some network operators may be surprised by the latest increase.
Despite the lack of up-to-date information, the VO has still implemented the UK’s 2026 business rates revaluation (revaluations are carried out every 3 years by the VO), which is based on 2024 market conditions and re-assessed rateable values (RVs) across all non-domestic property — including some fixed telecoms infrastructure. The catch is that the VO doesn’t apply this as a simplistic uniform government-imposed % rise and instead adopts more of a case-by-case valuation that will vary.
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On top of that there are some transitional relief caps, which for example means that for larger properties (RV £100k+) the annual bill increases are capped at 30% in 2026/27. This helps to explain why some network operators may suddenly be seeing increases of around 30% in their Fibre Tax, but crucially this will vary between operators (it will be less for others and some may be lucky and see no changes).
Nevertheless, an up to 30% increase is still going to have a significant impact on some players, and you can see a few location specific examples of how some networks may be impacted here, here and here. The listed rises reflect a mix of more modest c.10% increases and go up to around c.30%.
All of this comes at a time when the operators building new fibre optic broadband networks are already being heavily impacted by an increasingly competitive environment and rising costs (high build costs, high interest rates etc.). The situation has resulted in plenty of job cuts and a greater focus on commercialisation instead of new fibre build (here), while others have been forced to consolidate and a few have even taken haircuts as lenders take control (here), or gone through administration to reduce debts (here).
Suffice to say that the last thing many fibre optic network builders need right now is yet another significant cost increase, but that seems to be precisely what many will have to contend with, which is before we even consider the long-tail impacts of current events in the Middle East (cost of fuel, supply shortages in other areas etc.). ISPreview did ask HM Treasury to comment, but has yet to receive a response.
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Finally, it’s possible that increases like this could eventually make their way on to consumer bills via future price rises, although it’s a little more difficult to assess that without first taking a wider view of the overall cost impact by each operator (requires access to data we don’t have).
NOTE:
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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The gov: fibre rollout isnt going fast enough!
Also the gov: we’ll take more money away from you
Most of the alt nets were unviable before Openreach started overbuilding them. Now they certainly are.
Overbuild by OR should not be allowed until they have achieved genuine, not Ofcom imagined*, national FTTP coverage with infill from public funding Project Gigabit.
* Ofcom “Ready access to FTTP” is imaginary, not customers real experience. I know this from first hand experience and many people who have the same, second hand.
So a commercial company should only be allowed to build where some ill informed person on the internet thinks they should?
Trouble is none of these companies are not profitable so they won’t be paying any corporation tax and many companies are using international tax law to book profits in other countries so where does the revenue come from?
“none of these companies”
Did you mean ‘some of these companies’?
This is stupid. Tons of people are being fired because costs keep piling up and the govt just decides to impose more and more costs
They claim to want ease the cost of living but this just forces prices up. The gov blames Iran war and pump profiteering for costs at the pump, however literally HALF of the pump cost is just the big daddy govt taking money with a minimal percentage due to price increases and another minimal percentage of pump profit
Another case of re-arranging deckchairs on the Titanic! Taking tax in one hand and giving a little bit for rural broadband but making sure that Sir Humphrey and the accountants/consultants ‘needed’ can live in the style they are accustomed to. It makes me ‘expletive’ angry that we – the public at large ultimately – are paying more but getting less.
I see that in another note here that UK is 70th least expensive but look at who is number 1 and 10. This tax hike will certainly take us further down the table (possibly below Germany or even the USA).
I suppose the Chancellor has to scrape as much of the dregs at the bottom of the barrel since there are not many big earners in the UK now that there is little North Sea oil left.
Sorry about the diatribe.
Telecoms Privatisation in the UK was botched. Instead of a single publicly owned National UK Open FTTP Network. What we got, was an Overbuilt mess, with vast swaths of Rural Britain left behind, until the late 2030’s. And a government, frantically scrabbling round, Taxing privatised infrastructure. We made the wrong choices, decades ago, and the pigeons are coming home to roost…
…because that approach went really well in Australia
I find it insane when everything run by the government is in shambles and some groups still think “hmmm the government should be in charge of even more things!!!”
Would be good to hear From @Far2329Light on this one, always worth reading his take on matters, especially financial. Far2329Light call home!
So let’s get this straight…
(Last) Government: We’re putting up £5Bil of funding up for Project Gigabit.
(This) Government: We’re going to tax you into desolation on that fibre network we gave you funding to build, even though it might make the network built financially unviable.
Make it make sense.
Presumably BT & Virgin get a free pass since their networks aren’t valued the same way?