The Australian government has released a draft law that would require Meta, Google and TikTok to pay the journalism sector for using their news in commercial agreements with local media outlets.

The draft of the ‘News Bargaining Incentive’ (NBI) , released for comment and discussion on Tuesday, states that social media platforms will have to pay a maximum levy of 2.25 percent of local annual gross income to the government if they do not reach a fair agreement with local media outlets. The Australian government has said that the revenue collected in this way will be redistributed to news organizations. The draft proposes that the money will be distributed based on the number of journalists employed by media organizations. However, if social media platforms enter into commercial agreements with media outlets, they will be able to reduce their tax liability to 1.5 percent. The more platforms pay local news organizations, the lower the tax they pay to the government. That's why the Australian government claims that it is called an incentive. However, a legal proposal has been prepared to pay at least 1.5 percent tax.

Australian Communications Minister Anika Wales said at a press conference on Tuesday that such a system is necessary because the number of people reading news on Facebook, TikTok and Google is increasing. According to Associated Press journalist Rod McGurk, Prime Minister Anthony Albanese has also taken the position that journalists' work should be financially valued and that large multinational companies should not profit from others' creations without paying a fair dividend. McGurk wrote about Prime Minister Albanese's view that investment in journalism is necessary to protect democracy.

Australia had previously implemented the 'News Media Bargaining Code' in 2021. At that time, Google and Meta had commercial agreements with more than 30 Australian media outlets, and it is estimated that the local media industry received 200 million Australian dollars annually. However, in 2024, Meta announced that it would not renew those agreements, remove the ‘news tab’ from Facebook, and stop paying for news.

Using a ‘loophole’ in the ‘news media bargaining code’, Meta chose to remove news from its platform and avoid paying. In an attempt to close that loophole, the new proposed law has proposed a system of imposing a 1.5 percent tax on annual gross income regardless of whether or not news is placed on the platform. This time, TikTok has also been included in the legal scope, while AI platforms have not been included, journalist Kate Park wrote in ‘Tech Crunch’.

Big technology companies have opposed the proposed law. Andy Stone, head of communications at Meta, said in a post on X that it was no different from a ‘digital services tax’ and that news organisations were voluntarily placing content on their platforms. ‘News organisations post content on our platforms for their own benefit,’ Stone wrote. ‘It is simply wrong to say that we use their news content.’ Google also claimed in its statement that there was no need for this law and that the Australian government did not understand the changes in the advertising market. Google also expressed dissatisfaction with the fact that Microsoft or Chat GPT, etc. were not included in the scope of the tax or incentive.

The US government, and in particular President Donald Trump, have been opposing such taxes on digital platforms. Australian Prime Minister Albanese has stated that the decision was in the national interest because Australia is a sovereign country. Apart from Australia, countries such as South Africa, Indonesia, and the UK have already enacted or are in the process of enacting similar laws to protect their local media industries. Canada recently repealed the Digital Services Tax due to pressure from the US government. Canada backed down after the US threatened to impose higher tariffs on Canadian steel, aluminum, and vehicles due to this tax.