The liability threshold is on the gross telco revenue for the relevant period, with the levy calculated on qualified revenue after allowed deductions. The listed telcos will have gross revenues above the threshold ($10m), including those related to other entities that, when combined, exceed the threshold.
Popular Low Earth Orbit (LEO) satellite broadband provider Starlink, operated by Elon Musk's SpaceX, needs to pay its share of the annual Telecommunications Development Levy (TDL), the Commerce Commission says.
For the first time, Starlink NZ Unlimited Liability Company, Starlink Internet Services Pte Ltd, Swarm NZ Ltd, and Swarm Technologies Inc, are deemed as local SpaceX qualifying liable persons or QLP, under the TDL legislation the Commission administers.
Established under the Fifth National Government in 2011, the TDL pays for commercially non-viable telecommunications infrastructure and services. This includes broadband for rural areas and improvements to the 111-emergency service.
The TDL is not popular with telcos, with Spark, for example, saying it would pass on the cost to consumers. That was in 2015 when the TDL was at its original $50 million level. It has since been reduced to $10 million in 2020, and stands at $12 million this year.
Now it's SpaceX Starlink's turn to come to the TDL party.
“For the first time, Starlink’s revenue has reached the threshold where it needs to join other telcos in contributing to the TDL and subsiding services in the public interest. Starlink’s levy share will be proportionate to its qualified revenue of $74 million for this year,” Tristan Gilbertson, Telecommunications Commissioner, said.
The TDL is levied on providers that have revenue over a minimum $10 million threshold. SpaceX soaring revenue in New Zealand on the back of over 37,000 customers has placed it in the number eight spot among New Zealand telcos this year.
Of the total nearly $12 million a year, the SpaceX NZ Group of QLPs will be up for 1.52 per cent of the total, or $181,786.64.
The top TDL payers in New Zealand are Spark, One NZ, Chorus and 2degrees, which the Commission is asking to stump up 84 per cent of the $12 million total for the current round.
The Commission's allocation table below indicates a range of providers with less than the $10 million qualifying minimum revenue pay a proportion of the TDL. We have asked the Commission for an explanation and will update the story when one arrives.
Update A Commission spokesperson explained like so:
"The liability threshold is on the gross telco revenue for the relevant period, with the levy calculated on qualified revenue after allowed deductions. The listed telcos will have gross revenues above the threshold ($10m), including those related to other entities that, when combined, exceed the threshold."
ComCom's TDL allocation for providers operating in New Zealand
| Provider | Revenue | Share of Revenue | Levy Payment |
|---|---|---|---|
| Spark group | $1,397,790,784 | 28.87% | $3,443,551.78 |
| One New Zealand Group Ltd | $1,096,706,000 | 22.65% | $2,701,809.13 |
| Chorus group | $928,332,000 | 19.17% | $2,287,008.43 |
| 2Degrees group | $636,729,000 | 13.15% | $1,568,624.79 |
| Tuatahi First Fibre Ltd | $136,507,000 | 2.82% | $336,294.19 |
| Enable Service Ltd | $112,739,000 | 2.33% | $277,740.12 |
| Connexa Ltd | $108,416,000 | 2.24% | $267,090.12 |
| Fortysouth Group LP | $84,999,670 | 1.76% | $209,402.41 |
| SpaceX NZ group | $73,790,000 | 1.52% | $181,786.64 |
| Sky Network Television Ltd | $52,376,000 | 1.08% | $129,031.81 |
| Mercury NZ group | $51,138,000 | 1.06% | $125,981.91 |
| Kordia Ltd | $26,852,669 | 0.55% | $66,153.36 |
| Northpower Fibre Ltd | $17,808,000 | 0.37% | $43,871.21 |
| Vector Communications Ltd | $17,525,000 | 0.36% | $43,174.02 |
| Lightwire Ltd | $16,986,000 | 0.35% | $41,846.16 |
| Cello Group Ltd | $12,975,000 | 0.27% | $31,964.79 |
| Devoli group | $12,248,803 | 0.25% | $30,175.75 |
| Vital group | $11,003,037 | 0.23% | $27,106.72 |
| Voyager Internet Ltd | $10,341,000 | 0.21% | $25,475.75 |
| Inspire Net group | $9,158,000 | 0.19% | $22,561.35 |
| Feenix Communications Ltd | $6,930,000 | 0.14% | $17,072.52 |
| Plan B group | $5,810,638 | 0.12% | $14,314.90 |
| Wireless Nation Ltd | $4,351,000 | 0.09% | $10,718.98 |
| MyRepublic Ltd | $4,027,000 | 0.08% | $9,920.79 |
| Todd Corporation group | $3,339,161 | 0.07% | $8,226.25 |
| Transpower New Zealand Ltd | $3,000,000 | 0.06% | $7,390.70 |
| Total Industry | $4,841,878,762 | 100% | $11,928,294.57 |
13 Comments
"TDL pays for commercially non-viable telecommunications infrastructure and services" - just wondering what NZ owned telecommunications infrastructure and services , other than users terminal is in use . It seams they ;ve built their own infrastructure. Expecting another unwinnable court fight against Musk
I didn't say that, don't try & put words in my mouth.
& it looks like Starlink is already essential emergency communications in any case
https://www.consumer.org.nz/articles/starlink-satellite-internet-should…
I didn't say it should have to fund unpopular competitors, don't try and put words in my mouth.
The government uses the annual levy to pay for telecommunications infrastructure including the relay service for the deaf and hearing-impaired, broadband for rural areas, and improvements to the 111 emergency service.
You say they shouldn't have to pay the tax/levy.
Ergo, you think they shouldn't have to support the 111 service
yes ironic isn't it, but do you carve out a loophole in the law just for starlink, to save them $180K, what about the other mobile providers one and spark who have been part of the solution for rural customers? Suddenly there's no one left paying it. Perhaps it's not needed post LEO satellites.
yeah if you can't get RBI seems you can get $2K grant which i expect most people will spend on starlink these days.
I've got no problem contributing to the levy when the money is being put to good use. We all benefit from it.
The Rural Connectivity Group is funded by it and they have done fantastic work and really made a major difference to the cellular coverage in NZ. It has been a game changer for everyone.
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