Default Tablet Talk cuts off internet to other apps?

Hi,

I'm using Tablet Talk on Nexus 4 phone and Nexus 7 tablet installed in my car dash. The application works totally fine except for one strange issue: it appears to cut off internet to other apps installed on Nexus 7. Internet connection is shared by the phone via Bluetooth.

When Tablet Talk is connected, Youtube shows connection error, Waze navigation cannot reach its servers most of the time (though not always), Chrome browser either works extremely slowly (loading google search results for about 3 minutes) or don't work at all.

Everything works fine as soon as I disconnect Tablet Talk.
I was unable to google similar issue reported by other Tablet Talk users, so maybe I'm doing anything wrong?

Any ideas are most welcome.