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The government is to provide the digital sector with a £60 million tax boost to make it easier for firms to lay fibre broadband cables.

Telecoms networks currently pay business rates on the fibre infrastructure required to deliver high-quality broadband and mobile connectivity to homes and businesses.

Ministers are therefore proposing giving these companies a tax break for up to five years on the infrastructure they deploy to provide full fibre broadband.

The measure, included in the new Local Government Finance Bill, would save them around £60 million, which could be reinvested in fibre deployment.

The government has stressed that the tax relief will not apply to existing infrastructure.

This, it said, means companies have an "added incentive to move further and faster to get people connected to the best possible services as they become available".

Sajid Javid, the Communities Secretary, commented: "We need to have the best possible digital technology and broadband connections if we’re to create an economy that works for all.

"The Local Government Finance Bill will offer a £60 million boost to deliver ever-faster broadband connections, making UK PLC an ever-stronger competitor on the global stage."

This is the latest move in a wider commitment by the government to boosting fibre coverage across the UK.

Chancellor of the Exchequer Philip Hammond confirmed in his Autumn Statement that £400 million is to be put towards improving the UK's fibre broadband infrastructure.

The money will be placed in a Digital Infrastructure Investment Fund, with cash shared between fibre broadband providers seeking to expand, while private investors will be asked to match the amount put forward by the government.

A further £740 million will be put towards developing 5G services and a scheme that enables local authorities to bid for fibre connectivity.

"Our future transport, business and lifestyle needs will require world-class digital infrastructure to underpin them, so my ambition is for the UK to be a world leader in 5G," Mr Hammond commented.

"That means a full-fibre network; a step-change in speed, security and reliability."

The government's latest announcement has been welcomed by the Country Land and Business Association.

However, President of the body Ross Murray stressed "it must deliver for the countryside".

"Rural communities are still struggling with unreliable connections, if they even have any service at all, which has negative consequences for people living and working in rural areas and also impacts on much-needed rural tourism," he said.

Mr Murray insisted it is vital that rural areas are not "continually left behind" as new technology is developed.

"Incentives such as this tax break must push network providers to connect hard to reach rural areas faster, so homes and businesses in the countryside see results from the funding and tax breaks that these large multi-national companies have been given," he stated.

Mr Murray added that ministers must also make sure any new policies "recognise the positive role landowners and rural businesses can play in the rollout programme, looking at opportunities for private investment and collaboration and smart solutions to building the infrastructure we need".

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