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VAT hike hits your phone bill

The VAT increase to 20% is set to affect your phone bill, but will vary a lot, depending on your network.

Affecting both pay-as-you-go and monthly customers, each network seems to be tweaking their prices differently, with some taking the chance to increase their prices beyond the 2.5% VAT increase.

O2 pay-as-you-go customers will see the price of a text message go up to 12p from 10p.

Although it’s a 20% increase, (shocking! appalling!) there’ll be no other changes. Pay monthly customers will see the VAT increase in their monthly bills; A £30 contract will only go up to £30.64.

Orange customers will have a happy new year on pay-as-you-go, with no changes to the cost of calls and messages. Pay monthly will go up by the amount of VAT. This means a phone previously £35.25 per month would now cost £36.

T-Mobile pay monthly customers will see a similar deal to Orange, and costs not covered on your contract’s free minutes will go up. Voice minutes will go from 30p to 30.6p.

T-Mobile’s pay-as-you-go customers will see text messages go up by 1p. This is a huge increase on the 6p mobile to mobile rate, but will be the only change to pay-as-you-go.

Three will see an increase across both pay-as-you-go and monthly tariffs, and if you’re used to getting a paper version of your itemised bill sent to your house each day, the price will go up from £1 to £1.50.

If you’re on Vodafone, their handy website breaks down all the changes. A £30 monthly tariff will go up to £30.65, and beyond your free minutes, calls between Vodafone customers will go from 20p to 20.3p.

It may well be worth checking your phone bill and thinking about a switch.



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