BT has confirmed that it will be increasing line rental by 50p from October.

From the Autumn, the cheapest cost of renting a telephone line from the company will be £12.04. The costs of calls is also set to rise by around 10 percent.

Making a daytime call during the week will rise to 6.4p from 5.9p. While call connection charges will also go up 1p to 10.9p.

"Like many businesses, we have to review our prices as we seek to cover costs and emerge from recession in good shape," CIO 100 listed BT said.

"BT's tries to protect its customers from high prices; it has been a key mover in Terminate the Rate, the campaign to get the cost of calling mobiles lowered."

BT strike ballot cancelled by CWU

The rise in the cost of line rental will begin at the same time as a 'broadband tax' was due to be introduced.

The Labour proposal, which was designed to fund the roll out of super-fast fibre broadband access, would have seen Brits with a telephone line paying a £50p per month levy. However, it has been scrapped by the new coalition government.

It is thought other telecommunications companies such as Sky and TalkTalk will increase their line rental costs as well