The BBC faces two existential crises. The first is obvious: the licence fee is dying. Younger audiences don’t watch linear TV. Coverage is declining. Enforcement costs over £100m annually to prosecute people who can’t afford £174.50. Within a decade, the model collapses completely.
The second crisis is worse: nobody trusts the BBC’s independence anymore. And why would they? Ministers appoint the Board. The government sets funding levels. Every charter renewal becomes a hostage negotiation where editorial freedom trades for financial survival. Trust in BBC impartiality has fallen 15 points since 2018. The public sees the strings.
Charter renewal in 2027 offers the chance to fix both problems structurally. Not tinkering with board composition or modest fee reforms, but genuine liberal reform: progressive funding and democratic independence.
Replace the Poll Tax with progressive taxation
The licence fee is a regressive poll tax. A nurse and a banker pay the same £174.50 regardless of income. That’s illiberal and unsustainable. We should replace it with a Digital Services Tax on companies profiting from content infrastructure.
Netflix, YouTube, Meta, Amazon, Disney+, Spotify: these corporations extract billions from UK users whilst routing profits through tax havens. Make them contribute, with 3-5% on UK revenues over £25m, and infrastructure providers and device manufacturers paying lower rates.
This raises £2bn annually. Combined with BBC Studios’ commercial revenue (£1.5-2bn from international sales), that’s £3.5-4bn total, which maintains current funding levels.
The liberal case is straightforward: progressive taxation replacing regressive levies. Those with greatest capacity pay proportionally more. Nobody gets criminalised for being poor. Universal access replaces means-tested exclusion.
Plus, it’s popular. Taxing profitable tech corporations polls well across the spectrum. And it’s sustainable: revenue scales with the growth of the digital economy, with no political negotiations required.
End Ministerial control
Here’s what independence looks like now: the Culture Secretary appoints BBC Board members. Government sets funding levels. Ministers can phone the Chair to complain about coverage. Every decade, the BBC begs for charter renewal.
That’s not independence. It’s dependence with good PR.
Real independence requires structural protection. Create a BBC Trust with nine trustees appointed by an independent commission using Nolan principles: merit, diversity, transparency. No ministerial involvement in selection, shortlisting, or approval. The commission is chaired by the Speaker’s Committee with representation from the Royal Society, British Academy, and creative sector.
Enshrine editorial independence in statute. Make political interference unlawful, not just inappropriate. If a minister attempts to influence editorial decisions, that’s a statutory breach, which is reportable, subject to investigation, and to parliamentary accountability.
Replace the 10-year charter cycle with a permanent charter. The BBC exists in perpetuity unless Parliament votes by 60% majority to amend core provisions. No more renewal negotiations where independence trades for survival.
This is liberal constitutionalism in practice: dispersed power, legal protections, structural safeguards. Not trusting politicians to behave well, but making bad behaviour costly.
Universal access, commercial revenue
DST funding means universal UK access. No payment barrier, no enforcement bureaucracy, no geographic restrictions within Britain. Everyone contributes through progressive corporate taxation, and everyone benefits through free access.
Internationally, maintain geographic restrictions to protect BBC Studios’ commercial revenue. Let the BBC sell programmes to Netflix, licence formats, and co-produce internationally. That £1.5-2bn funds quality content without compromising the public service mission.
This isn’t complicated: public funding for public service, commercial income for reinvestment. Clean separation, both streams secure.
Why Liberal Democrats should lead this
This reform embodies core liberal values:
- Individual freedom: Universal access without payment barriers or enforcement. Creative freedom through editorial independence.
- Dispersed power: Independent governance replacing ministerial control. Structural protections preventing executive overreach.
- Progressive economics: Those with the greatest capacity pay proportionally more. The regressive poll tax abolished.
- Democratic infrastructure: Genuinely independent public media serving democracy, providing trusted information, cultural citizenship, and creative space free from political and commercial pressure.
- Constitutional reform: Using appointments commissions, statutory protections, and permanent charters to entrench independence structurally.
We talk about reforming British democracy. Here’s a concrete test case: can we build public institutions that are genuinely independent, progressively funded, and structurally protected from political interference?
The BBC won’t survive on the current model. The licence fee is collapsing. Political control is eroding trust. Charter renewal in 2027 forces a choice: bold reform or managed decline.
Liberal Democrats should champion the bold option. Progressive funding that’s fair and sustainable. Democratic governance that’s actually independent. Universal access that serves everyone.
The BBC can be what it claims to be (independent, trusted, creative, necessary) but only if we’re willing to give it genuinely democratic foundations.
That’s the liberal case. Let’s make it.
* Tanya Park is a Lib Dem County, Borough & Town councillor in Eastleigh, Hampshire and writes at A Just Society, a liberal policy project making the case for radical progressive policies grounded in liberal principles.
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23 Comments
@Tanya
Agree except there needs to be a way to ensure that the BBC reflects the multinational nature of the UK by a having mechanism to ensure that each country is appropriately represented on the Trust
You are of course right to say that “A nurse and a banker pay the same £174.50 regardless of income.” But that is also true of a Netflix subscription, which has the same cost per month irrespective of income. Saying that Netflix has to put the price up a bit to cover the cost of the BBC might not be any more progressive.
YouTube and spotify, unlike the BBC, allow customers the choice of whether to pay or have ads.
@Joan Absoluetely, and I cover that in my longer form essay here – https://ajustsociety.substack.com/p/the-bbcs-last-chance-why-2027-matters
@Tim L where did I say Netflix has to put their price up a bit? The value of the BBC is that it isn’t reliant on ad-related income, so it can create content that is valuable to society even if it isn’t commercially valuable.
Tanya, “ where did I say Netflix has to put their price up a bit?“ ,- thats how economics works.
I was intrigued by your saying netflix etc use tax havens – do you have evidence of this?
On tax havens: Netflix reported UK revenues of approximately £1.5bn in 2023 but paid just £4.5m in corporation tax (0.3%). Amazon UK Services reported £5.4bn revenue but paid £6.5m corporation tax (0.12%). This isn’t illegal – it’s routing profits through low-tax jurisdictions like Luxembourg and Ireland. The DST exists precisely because standard corporation tax doesn’t capture value extracted from UK users.
On “that’s how economics works”: You’re right that some corporate tax gets passed to consumers through prices. But the incidence matters. A flat £174.50 household charge takes 0.35% of a £50k income and 0.87% of a £20k income. A 3-5% DST on Netflix’s UK revenues might add a few pence to monthly subscriptions, paid proportionally by those who can afford streaming services. That’s progressive: burden shifts from struggling households to corporations and their customers, who self-select by consumption choices.
Tim L’s point about Netflix subscriptions being flat-rate misses the distinction: the licence fee criminalises non-payment (75% of prosecutions are women, many in poverty). Netflix doesn’t prosecute anyone. You just don’t subscribe. That difference matters.
Much to like in this, some doubts.
The DST of course may shrink or balloon in value with the next transformation in viewing, whatever that is, at which point there will good reason for the government to tinker with the formula – so we’re not completely free of government influence there.
It is genuinely difficult to have a state broadcaster not reliant on the state, accountable to the people and not the government, free to create and yet not self-serving. I applaud the attempt.
Yet it does seem a double whammy of unfairness to tax the commercial rivals to pay for the BBC. But it is always somebody else who should pay for things, isn’t it.
Tanya is right on both counts: the BBC needs a better guarantee of editorial freedom, and a better source of funding. Her ideas seem well thought out, and I concur that other content providers shouldn’t be able to get away with tax dodges. I’m not sure why simply funding the BBC from UK tax revenues isn’t the best way of making it progressive.
This idea requires further thought. One problem is that you are asking people who subscribe to digital steaming services to pay for a different service they they may not watch. This is likely to lead to the same objection that many peo0ple have to the curent licence fee.
Turning to ending Ministerial control. How about some BBC trustees being elected by those paying the licence fee?
If the independent commission proposal is adopted this would no longer work but some trustees could be elected by the general electorate.
“One problem is that you are asking people who subscribe to digital steaming services to pay for a different service they they may not watch. ”
Most government services are provided in this way. The NHS is partially paid for by some taxpayers who hardly, if ever, use it. The education system is partially paid for by childless people. The motorways are partially paid for those who never drive on them. Flood defences are paid for by those who live well away from any potential flood zones.
That’s just the way it is!
@Tanya – Companies pay taxes on their profits, not on their revenue, so quoting the latter is just wrong.
If the banks in “the city” were being taxed by other countries on the revenue they earn in those countries, they’d have a lot less in both profits and revenue to pay taxes on to the Treasury here – but you won’t ever hear anyone here complaining about the fact the banks’ tax money ends up in our Exchequer, rather than those of other countries.
@Tanya – I think you need to step back a bit: both the BBC and ITV ie. the UK-based TV industry is facing an existential crisis. The combined size of the UK media industry is significantly smaller than any of the satellilte and streaming businesses. Remember Amazon Prime has revenues of circa 48Bn USD, Netflix circa 45Bn USD. ITV circa 2Bn USD and BBC circa 21Bn USD (using USD to faciitate comparison).
My understanding is currently the BBC doesn’t charge UK cable/satellite operators to carry BBC channels (because subscribers have already paid through the license), but they do pay for BBC content they wish to broadcast/stream on their own channels and they do pay for access to the BBC’s news gathering network. The BBC also gains revenues through production partnerships and the licencing of Formats to other networks.
A concern has to be the levying of a duty/tax on revenues would negatively impact these arrangements. I think we need to be careful, currently the BBC is in a poor state in part due to interference by successive governments over many decades Remember it was the government who decided to BBC didn’t need the full licence revenue and decided to divert an increasing portion of it to others. the fundamental question is do you want a wholly UK owned broadcaster or not.
Tanya, corp tax is paid on profit not revenue. In 2024 netflix paid 24% of their profits in tax https://s3.eu-west-2.amazonaws.com/document-api-images-live.ch.gov.uk/docs/GbLHIfzKiiFZ24meEv-NrKbzfIyiJVprXbYwexoTqoo/application-pdf?X-Amz-Algorithm=AWS4-HMAC-SHA256&X-Amz-Credential=ASIAWRGBDBV3KYH5EYVU%2F20260116%2Feu-west-2%2Fs3%2Faws4_request&X-Amz-Date=20260116T151643Z&X-Amz-Expires=60&X-Amz-Security-Token=IQoJb3JpZ2luX2VjEIf%2F%2F%2F%2F%2F%2F%2F%2F%2F%2FwEaCWV1LXdlc3QtMiJHMEUCIQCbTZj4tQV537lnyVw%2BGw1VooEdx3Gz4BelzIK%2BbsLq8wIgYDqvgaQwy2S4R0Do9I5Fr6q82N%2B4uz0czaTRcNcGCCQqgQQIUBAFGgw0NDkyMjkwMzI4MjIiDN1%2B5hTw9Njvcf67iireAzjshrHW9XnmDjUO%2FU78VhPXlNi%2F5O6jRybytEUCpDupvcKDpsk97m66FEGVC08J2Be6jbxj6LY%2BtIXpjC6OpGfPASLDwrhJb90qGUyppkMlUPilh8iY3F5v1867Uc0ZwBl9aikwP7SdXGAyQ8hZ7%2BaCr7ZpipJ6K7g5pgSeZ0134KYusUk8kt96JORwXBxiifHnPnc6wuWKuuGTM2tEVw2OHj1vtodWacJzqr1KNqN68wapq1tm4J%2FxbWdFcSzX30hZT9unX5r1sqtre3n2jhuBkDrnLi3CEGJiF6lAr6IDhi5%2BGgBlhq1YEmRvJb8wegbZygLXfo%2FrXYTebVFd5LjwTaAlXJvlgEED0nRa24Ck0MPGQIyONqPDgoDDqC9LjJbtaGQQr3XBpfFsBo1Nv1dVeumZS%2BfMnmmNPMwovPeSFtGCclduzaMajCZoFkBM7E3uDpPuPpyWhq8X6GHFJX4aUOe3dZMDQlZmgh62jJ5%2FsfzNEKsyWmB1wgvtwBrjsNBl4pHY23mKSgyRLWoFkenZhHydHm4bGOyifwRcGDiwQLp%2Fesj5jJ26fjPmuto6x4bTd4dnBaqOEcNl%2Fs40aIs5DnndpXMb5Tkj%2FSeLfB%2FQuXNHM%2FYkAAXD5lBfdCUw75epywY6pQGPNoZ3ar3IIYCbygRqaqZsanfyDJyqlkpsJfPGruHdf9q6cuuC%2Fe69ougWrWcm6gw18AgGZ3RkzsZOVjtroYfX6Z7KZl8lSQaLUF%2BRyQE8BVFqGa1Pd%2FaGnmObcKvEVWCz4bEjCjp3Li2AY8EL7RYnkoQoqC3m5m8nlvNH3gFlODBZRJHHnF%2FtF5MeHfkscUgCPqGpi4D%2FMNDL%2F42WUqQ83Ck%2FlTA%3D&X-Amz-SignedHeaders=host&response-content-disposition=inline%3Bfilename%3D%22companies_house_document.pdf%22&X-Amz-Signature=9c2b12368369993c346a768d1d591a726835b2d5a24a30d04ddf715a8fca162b
The suggestions here don’t even begin to address the fundamental problem with the BBC: the lack of viewpoint diversity amongst their journalists and editorial staff. This has resulted in the collapse of trust in its output from those outside of its left-liberal (woke) echo-chamber. I see strong parallels here between the BBC and public broadcasting in the US where trust has similarly collapsed. The BBC is on a similar path to irrelevance for much of the population.
.
I recommend reading these two articles from former editors within their respective organisations, National Public Radio (NPR) and the BBC…
‘I’ve Been at NPR for 25 Years. Here’s How We Lost America’s Trust.’ [April 2024]:
https://archive.is/H7QNM
‘How to fix the BBC’ [November 2025]:
https://archive.is/PUoRa
I’m sympathetic to the aims of this article but I think it’s over-egging the case a bit.
The license fee is not really a tax. It’s a payment for a service, in much the same way that a Netflix subscription is a payment for service. If you don’t want to watch tv, then you don’t have to pay the license fee. Complaining that everyone pays the same amount to buy a tv license is about as logical as complaining that Sainsburys charges the same amount to everyone to buy a loaf of bread. Having said that, I do agree that the license is not a good way of paying for the BBC.
Not having BBC board members appointed by some group other than the Government doesn’t really guarantee independence – it means that the BBC risks becoming dependant on whichever group does appoint them. I’m not sure true independence is possible. But it’s still worth looking at see if we can improve things.
Tanya Park 15th Jan ’26 – 9:56pm:
This isn’t illegal – it’s routing profits through low-tax jurisdictions like Luxembourg and Ireland.
Neither of which are “tax havens”. The streaming services are all required to levy 20% VAT on their customers while the BBC is exempt and also pays no Corporation Tax on its broadcasting activities. Netflix, at least, now pays both VAT and Corporation Tax in the UK, as summarised by Gemini…
Simon Robinson 16th Jan ’26 – 4:11pm:
The license fee is not really a tax.
It is a tax. Gemini again…
It’s a payment for a service,…
Not if you only want to watch other (non-BBC) broadcast services such as ITV, GB News, Sky, etc.. It’s like being required to pay for a daily copy of the Guardian, even if you never read it, before the state will allow you to legally buy any other newspaper or magazine.
Correction: I misstated the BBC’s revenue, it should be circa 7.9Bn USD.
@Simon McGrath – the link you provided has expired.
It is impossible to make the BBC truly independent. No parliament can bind it’s successor, there would be nothing to stop a future parliament from repealing any law that purports to make the BBC truly independent.
@ Jeff,
‘Neither of which (Luxembourg and Ireland) are “tax havens”.’ ???
You seem fond of appealing to Gemini as an oracle. Yet you’ve not bothered to check its opinion on these two. When I asked the question the answer is:
“Yes, Ireland and Luxembourg are frequently labeled as corporate tax havens” . It then goes on to explain “why they are considered tax havens”.
@ Paul R, You are correct that Corporation tax is levied on profits. But also Tanya is quite right to point out that if corporation tax paid is only 0.3% or 0.12% of turnover then this is likely evidence of ‘profit shifting’.
It’s why we should be taxing international companies like Amazon and Netflix on their turnover in the UK and on the basis of their worldwide profits ($59.2 billion and $8.7 billion). Not on all their profits but it’s easy enough to calculate what their real profits are in the UK.
Peter Martin 16th Jan ’26 – 8:37pm:
Yet you’ve not bothered to check its opinion on these two.
No need. For large multinational companies with a global turnover over €750 million both Ireland and Luxembourg apply the OECD Pillar 2 15% global tax. As Tanya correctly says, they are “low-tax jurisdictions”.
But also Tanya is quite right to point out that if corporation tax paid is only 0.3% or 0.12% of turnover then this is likely evidence of ‘profit shifting’.
Or investing a lot in new studio facilities and content production in the UK…
‘BBC and ITV slash big-budget TV spend as US streamers pour money into UK’ [February 2025]:
It’s why we should be taxing international companies like Amazon and Netflix on their turnover…
Better to lower tax rates and attract such companies to headquarter in the UK.
It is not credible to argue that we can replace the revenue from a charge on almost all households of over £170 a year with a charge on Netflix subscribers of a few pence a month. By all means argue that the (say) half of people who subscribe to Netflix etc should each pay an extra £340 a year to get rid of the BBC licence fee for all, but pretending that we can get money from “someone else in the world” is just not credible, whether or not Netflix is profitable, and whether or not they use tax havens – all of which comply with international law.
Jeff,
You can call them “low tax jurisdictions” if you like. Both myself, and your favourite AI chatbot, prefer plain English: Tax Haven.
Do you really believe that these large multinationals are straight with their tax returns?
@ Tim L,
I don’t think anyone is suggesting that a levy on Netflix alone can fund the BBC. The problem of ‘profit shifting’ extends far beyond them. Jeff’s favourite AI source puts the loss to the Treasury at least at £11 bn. The BBC’s income from the licence fee is £3.8 bn.