Netflix viewers who don’t watch the BBC could soon be forced to pay the licence fee anyway under plans being considered by Keir Starmer’s government.
A new TV tax could result in subscribers to streaming services having to help bear the cost of the public service broadcaster when its charter runs out in December 2027.
The option is one of a few currently under review of which others include making the £169.50 licence fee ‘progressive’ so wealthier households pay more or asking those who listen to a BBC radio station to pay a charge.
Whitehall sources say the Netflix tax plan is ‘speculation’ but has not been ruled out.
It comes as the government is faced with a rising fee evasion rate, which reached a high of 10.3 per cent in 2022-23, according to a House of Commons report.
Separately, Labour Culture Secretary Lisa Nandy has described the licence fee as ‘insufficient’ and ‘deeply regressive’.
There are currently 20 million UK households who subscribe to at least one streaming service, according to Ofcom figures, with Netflix claiming around 17million users.
Last year there were 23.9million households in the UK with a TV license, down from the figure of 24.4million in 2023.
Streaming giants like Disney and Amazon could also be impacted under the new plans which have been proposed amid a widespread change in viewing habits.
The government will consider options of how to provide a new long-term revenue stream for the BBC, as the number of people who choose to pay for its services is on the decline.
A source, familiar with the internal deliberations, added another possibility was to leave the license fee largely as it is, with a few tweaks, a continuation of uprating, and better enforcement, Bloomberg reports.
The fee dates back to 1946 and currently costs households who watch live TV or use BBC iPlayer £169.50 a year, an amount that usually rises annually with inflation.
But license fee income in 2023-24 totalled £3.66billion, just a small rise on the £3.51billion in 2010/11, according to government data.
Culture Secretary Lisa Nandy said earlier this month she had ‘already started initial discussions with the BBC leadership about the charter review’ and hopes to ‘future proof our national broadcaster until well into the latter half of this century’.
There was anger in November last year over the announcement the TV license fee would increase by £5 or 2.9 per cent from £169.50 to £174.50 next April.
The second consecutive annual rise followed a 6.6 per cent or £10.50 increase from £159 which came last April based on the inflation figure for September 2023.
And last year, Ms Nandy promised there would be ‘an honest national conversation about the broadcaster’s long-term future’.
The Sunday Times reported that Whitehall sources had said she already thought the licence fee had to go although final decisions were yet to be reached.
One source said: ‘Lisa does not believe that the licence fee is financially sustainable. But she believes that our national broadcaster should be owned by the nation.
‘The money would go in from taxes but citizens would own it and be involved in decisions about its strategic direction.’
Ms Nandy afterwards insisted funding the BBC through general taxation is ‘not something we’re considering’.
A BBC spokesman said: ‘We want everyone to get value from the BBC, which is why we’re focused on delivering what audiences want from us – trusted news, the best homegrown storytelling and the moments that bring us together.
‘The public cares about the BBC and this year, we will launch our biggest ever public engagement exercise so audiences can help drive and shape what they want from a universal and independent BBC in the future. We look forward to engaging with government on the next Charter and securing the long term future of the BBC.’
Netflix and the Department for Culture, Media and Sport have been contacted for comment.