I think for the reasons you give this bill is never going to actually get through in its current form, or, if it does, it won't be abided by nor enforced. The reason it's gotten this far is because government ministers don't have any idea how the web works and they've adopted an attitude of ignoring experts so they won't learn. Once ordinary Tory voters start to get irritated by the implications of the law (credit card to view porn?) it'll get quietly scrapped. In any case, I know otherwise-luddite 60 year olds who know how to use VPNs to watch geoblocked TV, so getting around it will be trivial for a sizeable chunk of the population. And there's no way the UK government has the resources and political capital to police the internet on the scale required by this bill.
I think you’re wrong, this UK government is scarily authoritarian and vindictive towards anyone who crosses them (see bullying of the BBC and the sale of Channel 4 as just two examples).
Why do the commenters here don’t think they want to be able to control and bully opponents on the Internet too?
I don't doubt that the government can make life hell for its opponents if it wants to, I just doubt that ordinary voters will allow it to get that bad. Tories have such power right now because they're taking actions (and making signals) popular with the people, whether the rest of us agree or not. I don't buy that they've so corrupted the system that it no longer matters what the voting public think, which is why I still believe this bill is not going to be implemented or enforced in a way that removes real freedoms, once the public notice.
Besides, don't plenty of despotic countries already ban VPNs around the world, to limited effect? A large, liberal country like the UK banning them would I'm sure drive improvements to VPN protocols to make them even harder for ISPs to detect.