Updated ,first published
The Meta has launched a scathing attack on the Albanon government’s plan to force the world’s biggest tech companies to fund Australian journalism, calling the proposed regime a “discriminatory tax built on a false foundation” that would leave the news industry stranded with government subsidies.
In formal presentation and marching blog post published immediately, the company that owns Facebook, Instagram, WhatsApp and Quest headsets said it was “vehemently opposed” to the News Negotiation Incentive, an initiative designed to force Meta, Google and TikTok to enter into commercial agreements with news publishers.
“Our position is clear: this law is poorly designed, completely unfair, and will fail to provide a diverse and sustainable media industry,” the company wrote. “Call it what it is: a discriminatory, regressive tax targeting a few foreign companies while competitors providing comparable services do not face the same liability.”
motivation, was supported by Prime Minister Anthony Albaneseit will levy a 2.25 per cent levy on the combined Australian revenue of the three platforms, with the revenue going to businesses that employ journalists. Companies can pay a fee by signing tax deduction agreements worth about 1.5 percent of revenue. The Treasury estimates the policy will provide between $200 million and $250 million a year to local media, and the government wants it signed into law this winter.
Meta’s main objection is the breadth of the tax, which covers “combined income attributable to Australia”. The clarification wipes out sales of its Quest devices and other products that the company says have nothing to do with the news. The case for making money from social media, where publishers voluntarily publish their content, was not supported by the evidence, the company said, and extending the rationale to virtual headphones and smart glasses was “untenable”.
Asked during the stimulus announcement about the impact from the US administration, Albanese said: “We are a sovereign nation and my government will make decisions based on the national interest of Australia”.
It’s a familiar fight: Meta withdrew its bids under the previous 2021 Media Dealing Rule in March 2024, saying the news had little commercial value to Facebook. The incentive was clearly designed to plug the loophole that allowed it to do so, with the fee applied regardless of whether the platform carried any information at all.
When Canada passed similar laws in August 2023, Facebook decided to block the news altogether rather than comply. The company claimed that after the move, daily and monthly active users on Facebook increased, and time spent on the platform continued to grow. It showed a huge shift in how people were consuming content, and noted that short-form video is now driving most activity, with Reels generating 140 billion daily views and video accounting for more than 60 percent of time spent on Facebook and Instagram. Meta claims that its users come for creators and entertainment, not news.
In its submission, the company also invoked trade law, arguing that the deal violates the Australia-US Free Trade Agreement by failing to give US companies “less favorable” treatment than their domestic counterparts. The issue has been raised by US business lobby groups, and the White House has described the policy as “foreign extortion”, although it has yet to set out any retaliatory measures.
Australia’s media giants have strongly supported the initiative. When it was announced in April, the heads of Nine, the owner of this masthead, ABC, News Corp, Network Ten, SBS, Southern Cross Media, Australian Community Media and Guardian Australia. he said the future of Australian journalism was at stake.
“The vitality of Australian democracy depends on the open and consistent exchange of information, views and opinions,” the group said. “This is under threat.”
Google, which has continued to honor and re-sign its existing deals covering more than 90 media businesses, faces an annual liability of about $202.5 million if it reneges on the deal, versus $33.75 million for Meta and $16.9 million for TikTok.
Industry lobby group FreeTV has called on the Treasury to expand the network to include Microsoft and Apple, while a separate carving out of Microsoft’s LinkedIn – which runs its own editorial team and news tab – has upset existing platforms. Former ACCC chairman Rod Sims, who designed the 2021 code, called the apparent exclusion “extraordinary”. With existing contracts expiring within months, he warned that “the urgency is great”.
with Nick Newling
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David Swan is the technology editor of The Age and The Sydney Morning Herald. He was previously the technology editor of The Australian newspaper.Connect through X or email address.
