Australia to Impose Tax on Tech Giants for News Revenue Sharing

The Australian government plans to impose a tax on large tech firms, like Meta and Google, to ensure revenue sharing with local news media. Starting January, companies will either share earnings from content or face a substantial tax, aiming to uphold quality journalism amidst challenges.

In a move aimed at safeguarding local journalism, the Australian government is set to implement a new tax on major tech firms that fail to share revenue with news media organizations, according to a report by Al Jazeera. The law, effective January 1, targets tech giants such as Meta and Google with revenues exceeding 250 million Australian dollars. These companies must pay for content or risk incurring significant tax penalties, potentially amounting to millions.

Australian Communications Minister Michelle Rowland highlighted the disruption caused by digital platforms to the media landscape, jeopardizing public interest journalism. Al Jazeera quoted her stating that these platforms need to support access to quality journalism, essential for democratic strength.

The initiative is not aimed at revenue generation, stressed Assistant Treasurer Stephen Jones, as reported by Al Jazeera. Instead, it seeks to incentivize agreements between platforms and news media firms in Australia. The rules aim to aid traditional media outlets struggling due to their content being freely available on digital platforms, leading to a loss of advertising revenue, and the consequential job losses among Australian journalists.

The News Bargaining Initiative, Jones explained, hopes to foster financial agreements between digital platforms and Australian news organizations, reported CNN. Meanwhile, Meta expressed concerns regarding the new proposal. A spokesperson said the current law is flawed, and criticized the strategy of charging one industry to subsidize another.

Meta has existing agreements with some Australian firms but stated it won't renew them post-2024, claiming the proposal fails to acknowledge how their platforms operate. As reported by CNN, Meta argues that most users do not visit their platforms for news content, and publishers voluntarily share content for the value they derive.

Furthermore, last month, Australia legislated against social media access for under-16s, according to Al Jazeera. The government is also considering imposing fines on companies failing to curtail offensive content and combat disinformation, as reported by Al Jazeera.

(With inputs from agencies.)