- The Australian government proposed a uniform 2.25% tax on tech giants' Australian revenues
- The tax aims to incentivise platforms like Meta, Google, and TikTok to pay news publishers
- Platforms avoiding deals must pay the tax, with funds distributed based on journalist employment
The Australian government has proposed a uniform tax on revenues of tech giants like Meta, Google, and TikTok to incentivise them to do commercial deals with publishers, news agency AP reported.
According to the draft legislation released on Tuesday, the News Bargaining Incentive (NBI) aims to create a financial incentive for the social media companies to strike deals with news organisations to pay for journalism.
Major platforms that choose not to strike commercial deals with news publishers will have to pay a 2.25% tax on their Australian revenue.
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However, Australian Prime Minister Anthony Albanese emphasised that a monetary value needed to be attached to journalists' work, as per the reports.
“It shouldn't just be able to be taken by a large multinational corporation and used to generate profits for that organisation with no compensation appropriate for the people who produce that creative content,” Albanese told reporters.
“We think that investment in journalism is critical to a healthy democracy,” he highlighted.
This is the country's second attempt to make the platforms pay for the Australian news text and images that their users view.
Before this, a legislation passed in 2021 had pressured tech giants to ink deals with Australian news publishers to pay for journalism, the legislation formed the basis for Australia's News Media Bargaining Code.
The platforms chose to reach commercial deals with news creators rather than be forced into arbitration and have a judge set the price. But they have since avoided renewing those deals by removing news from their services.
The tech titans will receive compensations and their overall costs would be lowered if they agree to pay publishers for journalism, the government was reported as saying.
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Moreover, the government expects the incentive would raise between $144 million and $179 million (200 to 250 million Australian dollars) a year.
That was about as much as the platforms paid news outlets when the News Media Bargaining Code was working at its peak, reports underscored.
The government would distribute that income among news organisations based on how many journalists each organisation employed, Communication Minister Anika Wells stated.
Meta Platforms, which owns Facebook and Instagram, Google, which is owned by Alphabet Inc., and TikTok, which is majority-owned by US-backed investors will come under the ambit of this taxation.
Meta, Google Hit Back
In their retort, the platforms remarked that they reject the need for this tax. A spokesperson from google reportedly said that the legislation "misunderstands how the ad market has changed, and mandates payments from some companies while arbitrarily excluding platforms like Microsoft, Snapchat and OpenAI, despite the major shift in how people consume news."
Opposing the proposed legislation, Meta said news organisations “voluntarily post content on our platforms because they receive value from doing so.”
“The idea that we take their news content is simply wrong. This proposed legislation, which would apply to platforms regardless of whether news content even appears on our services, is nothing more than a digital services tax,” Meta said in a statement.
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“A government-mandated transfer of wealth from one industry to another, with no connection to the value exchanged, will not deliver a sustainable or innovative news sector. Instead, it will create a news industry dependent on a government-administered subsidy scheme,” Meta added.
On a different front, since all the targeted platforms are American, critics from United States have argued that Australia's News Media Bargaining Code had disproportionately cost American corporations.
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