Budget 1999: Phones - Burden eased for mobile users
The Budget and Business
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.IT WAS Norman Lamont, the Tory Chancellor, who, in the 1991 Budget, imposed a tax on what he considered a growing menace: mobile phones.
Apparently annoyed by so-called yuppies shouting noisily into their mobiles, he gleefully announced he was going to tax them.
As a result, any individual provided with a mobile phone by an employer has been taxed.
Yesterday, the Chancellor announced he was scrapping the tax charge as of 6 April, removing "the unwelcome record-keeping and reporting burden on employers".
It is estimated this will benefit up to 350,000 individuals and will be worth pounds 80 to people on the higher tax code and pounds 46 to those on the standard rate.
The decision removes the difficulty faced by both employers and employees in trying to work out which calls were for business and which were for pleasure.
Under the old guidelines, employees could escape liability if they made no private use of the phone or re-imbursed the full cost of such calls.
According to details in yesterday's Budget documents: "That imposed further unwelcome compliance burdens on employees and employers."
The move is, perhaps, also a recognition that, since 1991, mobile phones have increasingly become less of a luxury for the wealthy and more of an important tool for work and business.
Neither companies nor individuals will have to do anything to fall in line with the new arrangements, which will cost the Government about pounds 25m a year. From May, Pay As You Earn codes will be altered to remove the tax charge.
It was also announced yesterday that telecommunication companies looking to buy licences to operate third- generation mobile phone services will receive tax relief.
It is expected that, by the end of the financial year, an auction will have been held for a series of licences that will operate for 20 years.
Tax relief will be spread over the life of the licence and will be legislated in 2000. The measure is designed to ensure consistent tax treatment for mobile communication services.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments