YTT Calculates Level Playing Field

Yorkshire Tyne Tees Television (YTT TV) has drawn up a plan which would require all broadcasters, including cable and satellite to pay a 14 per cent levy on advertising and subscription revenues. The plan, referred to as “the level playing field,” would provide an alternative to the current method which taxes only Channel 3 franchisees and soon Channel 5. BSkyB and Channel 4 are not required to pay anything.

Several arguments have been drawn up against the plan:

• Channel 3 should pay for the use of the spectrum
• Channel 3 is a valuable franchise and it should pay for the privilege
• The Broadcast Act 1996 should favour Channel 3
• BSkyB should not be taxed as it broadcasts from outside the UK

In response to these suggestions, YTT TV argue that if there were problems with using the spectrum Channel 5 would not have been developed. With the introduction of digital, there would be plenty of room for a number of channels. YTT TV believe that Channel 3 once had a virtual monopoly, but with the amount of competition developing it is no longer a privileged franchise. YTT also say that the Broadcast Act 1996 would favour Channel 4 as costs could increase more for Channel 3. This would allow Channel 4 to become more commercial. In regards to BSkyB, YTT point out that the satellite broadcaster is actually licensed by the ITC and if constraints are not imposed then there is the danger of it becoming a monopoly.

The Level Playing Field

Channel 3 is expected to pay £400m to the Treasury in 1996 for broadcast licences.

YTT TV: 0113 243 8283