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BT and Virgin Media have joined forces to oppose a planned increase in business rates.

The broadband providers believe the revaluation of rates, which is due to be implemented at the start of April, will treble their tax bills.

This, they warned, could in turn force them to drop plans to invest in new broadband infrastructure upgrades.

Ministers have already confirmed that a five-year 100 per cent business rates holiday will be introduced for broadband providers that invest in a full-fibre network.

However, BT and Virgin still have copper elements even in their fibre-based systems and would therefore not benefit from the offer.

Matthew Howett, a telecoms analyst at Ovum, backed their concerns, saying: "At a time when the government is trying to encourage private sector investment in the next generation of broadband infrastructure and reduce the digital divide, it’s a backwards step to hike business rates and not think this will directly affect the number of additional premises that could be connected."

Chancellor of the Exchequer Philip Hammond has already 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."

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