Under the plan, the party would nationalise part of BT the London-based multinational telecommunications holding company to deliver the policy and introduce a tax on tech giants to help pay for it.
Shadow Chancellor John McDonnell told the BBC on Thursday night that the "visionary" 20 billion pound ($25 billion) plan would "ensure that broadband reaches the whole of the country".
McDonnell said that the ruling Conservatives' funding plan for improving broadband was "nowhere near enough" and would leave the UK falling further behind other countries who already have fibre more widely available.
Broadband packages in the UK cost households an average of around 30 pounds a month, according to broadband comparison site Cable - which people would no longer have to pay under Labour's scheme.
The party claimed that it would "literally eliminate bills for millions of people across the UK".
According to a report from regulator Ofcom earlier this year, only 7 per cent of the UK has access to full-fibre broadband.
The government hit its target to bring superfast broadband to 95 per cent of homes by December 2017 - at a cost of 1.7 billion pounds - but the internet speeds were significantly lower than those of full-fibre.
McDonnell told the BBC that Labour would add an extra 15 billion to the government's existing 5 billion pounds broadband strategy, with the money to come from the party's proposed Green Transformation Fund.
"We're putting the money in and therefore we should own the benefit as well," said the shadow chancellor.
In reaction to the development, BT Chief Executive Philip Jansen told the BBC that he was happy to work with whoever wins the election to help build a digital Britain.
He added that the impact of any changes on BT pensioners, employees, shareholders - and the millions of investors via pension schemes - needed to be carefully thought through.
However, the ruling Conservatives said it was a "fantasy plan" that would cost taxpayers billions, while TechUK, which represents many UK tech firms, said the proposals would be a "disaster" for the telecoms sector and customers.
The Liberal Democras said it was "another unaffordable item on the (Labour's) wish list".
( With inputs from IANS )