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The Netherlands opposes the introduction of a European ‘internet tax’ for tech giants. This says Minister of Economic Affairs Micky Adriaansens in conversation with Reuters. According to her, this would unnecessarily drive up costs for consumers and violate net neutrality.

With her remark, the minister goes against the plan of the European Commission to start a consultation round on the future of the required connectivity and infrastructure. Part of the consultation will include how and who should bear the financial burden of these investments in 5G and broadband.

The telecom industry in the EU has been advocating an “Internet tax” for large tech companies for years. Think Google, Meta, Amazon, Microsoft, Netflix and Spotify. According to telecom operators, the companies use the most broadband and should therefore contribute more to the cost of the infrastructure they use. Current European Commissioner in charge Thierry Breton, himself from the tech and telecom sector, is said to be in favor of the levy.

Users suffer

Minister Adriaansens does not like this possible Internet tax to be imposed. An extra tax on large tech companies for using Europe’s 5G and broadband infrastructure will lead to price increases for users, she says. Especially now that many end users purchase streaming services, the very services that should be taxed extra.

According to her, other funding options must first be explored before passing on costs to customers. For example, are governments able to bear the costs, are there other financing possibilities or should the infrastructure costs be left to the infrastructure players themselves?

Also, the proposal would go against the EU’s self-imposed measure of net neutrality whereby operators are not allowed to prioritize services over others or impede them.

Oxera report

Minister Adriaansens bases her assertions in part on a recent report by consultant Oxera. This report commissioned by Adriaansens’ ministry states that European telecom operators do not suffer from the higher costs for their networks. This despite the growth of data traffic via the internet. On the contrary, these telcos are said to have more funds due to the modernization of their networks, which means that fewer personnel are needed and CAPEX expenses are also falling.

In short, according to the researchers, European telecom operators have no economic basis for their claim that they are incurring more connectivity and infrastructure costs due to the growth in data traffic caused by big tech.

Also read: European Commission starts consultation on big tech network costs