What is a ‘YouTube tax’ and how would it work?

The Government is expected to propose extending the TV licence fee to streaming services such as YouTube, Netflix and Amazon Prime Video. The change is intended to reflect how people now watch video and prevent households from avoiding the fee by using internet services instead of conventional television.

The licence currently costs £180 a year, with exemptions or discounts for some people, and generally does not cover on-demand services other than BBC iPlayer. The BBC says 94 per cent of households use its services, while 80 per cent pay the fee; about 539,000 fewer licences were in force in the year to 31 March 2026, and numbers have fallen by around two million over five years. A government white paper on renewing the BBC charter is due before Christmas, while MPs have called the current funding model outdated and suggested a broader levy.