A Labour plan to impose the BBC licence fee on households that exclusively watch streaming services such as Netflix, Amazon Prime, Disney+, and Apple TV has been branded 'outrageous' by critics. The proposal would require Britons to pay the £180 annual levy to fund the BBC even if they only consume on-demand content via rival platforms.
John O'Connell, chief executive of the TaxPayers' Alliance, told the Daily Mail: 'Forcing streaming service subscribers to pay the licence fee would be an outrageous expansion of an already deeply unpopular tax.'
Currently, a TV licence is not required to binge-watch shows like Stranger Things on Netflix, The Boys on Amazon Prime, or Slow Horses on Apple TV. However, if households stream live television—such as Champions League football or boxing—through a subscription service, they are legally required to hold a licence, which rose to £180 in April.
Labour's Preferred Option
Expanding the licence fee to cover subscribers of services like Netflix is Labour's preferred approach, according to industry sources involved in negotiations about the BBC's future funding model from December 2027. The BBC has seen its income fall by a quarter over the past decade and claims it must make £500 million in savings, including cutting 2,000 jobs within the next two years.
'It's pretty desperate to argue that everyone should be made to pay for the BBC whether they watch it or not,' a streaming source with knowledge of the negotiations said. 'The BBC needs to think more radically and creatively about how to generate income in ways that don't undermine universal access.'
Government Concerns
The government is reportedly wary of funding the BBC through advertising or a new subscription model because it could harm ITV and Channel 4. Instead, a blanket approach—expanding the licence fee to cover all streaming platforms—could be imposed when the current BBC charter ends in December 2027, according to a report in The Times. An industry source stated that ministers favour this 'expansive approach' over an advertising model.
John O'Connell added: 'In an age of endless viewing choice, taxpayers should not be compelled to fund the BBC simply because they own a screen or use a streaming service. Rather than dragging more people into the licence fee net, ministers should finally look at a fairer and more modern funding model and abolish the licence fee.'
Culture Secretary Lisa Nandy has previously expressed concern that moving from the licence fee to a BBC subscription would undermine the broadcaster's ability to 'unite the nation'. She said last year: 'If you believe, as I do, that one of the greatest strengths of the BBC is its ability to unite the nation that has found multiple ways to divide itself, then I think you've got to be cautious about the use of subscriptions and paywalls.'
BBC's Position
The BBC declined to comment on The Times report, stating that it was a matter for the Department for Culture, Media and Sport. However, in March, a BBC paper on its future noted that 80 per cent of UK households pay the licence fee, even though the corporation believes 94 per cent of the population uses BBC services monthly. The document warned: 'Households that watch or record live TV—on the BBC or elsewhere—or use BBC iPlayer to watch BBC content are required to hold a licence. The number of people consuming live TV has fallen, as has the volume of live TV consumed. This is because audience behaviour has changed at a pace and scale not anticipated in the last Charter Review.'
The paper also noted that 'the general approach others [abroad] have taken has been to restore universality of payment while taking steps to enhance fairness through progressive pricing or concessions to help those on lower incomes.'
Streamer Reactions
Streaming services are said to be very unhappy about the prospect of all their customers being charged the licence fee on top of their subscription fees.
The Department for Digital, Culture, Media and Sport said in a statement: 'The government does not comment on speculation. We are reviewing responses to the BBC Charter Review consultation and will set out our decisions in a white paper to be published later this year.'
The government is exploring options to replace or modify the current licence fee funding model when the BBC charter ends in December 2027. Alternatives under consideration include allowing the BBC to use advertising, imposing a specific tax on streaming services, or charging those who listen to BBC radio. The government could also decide to alter or retain the current TV licence system. Funding through general taxation or a subscription model remain possibilities, as does a system where wealthier households pay more than poorer ones.
