MPs back tax on tech giants

A Labor-dominated committee of MPs has backed a levy on tech giants, a new minister for digital affairs and a short-term cash injection to prop up ailing media firms, in one of the clearest signals yet on the Albanese government’s plans to rein in social media platforms.

As Labor mulls a new model to pay for public interest journalism, the inquiry into how social media is reshaping society said a Morrison government-era code forcing Meta and Google to pay tens of millions of dollars to media companies for their content was insufficient, and the government should come up with new tools to extract money from the behemoths.

Assistant Treasurer Stephen Jones and Communications Minister Michelle Rowland have been leading the government’s work on a new model to fund journalism.Credit: Ben Symons

Labor sources, unable to talk publicly about government decisions that were not yet finalised, said the influential report would inform its thinking on a potential levy on social media firms that would, in part, help fund journalism.

This masthead revealed in August that Labor was considering a levy on tech companies, dramatically escalating the government’s stoush with the global giants that includes clampdowns on misinformation, child abuse material, addictive algorithms and copyright.

If a levy were pursued, the report said a new mechanism should be created to disperse the funds to needy media businesses, including those operating in regional areas.

In the inquiry’s final report, Coalition members split and labelled Labor “weak” for failing to force Meta, the owner of Facebook and Instagram, to renew deals with media businesses. Those deals were forced upon the platform by the Morrison government’s threat to enforce the code.

Large media companies such as Nine Entertainment – which owns this masthead – and News Corp are pressuring the government to use the arbitration mechanism within the existing code. But this masthead has previously reported that Meta has threatened to cut out all news from Australian users’ feeds if the government does so.

Decisions on the news deals are expected within weeks and a spokeswoman for Assistant Treasurer Stephen Jones confirmed the Coalition-era code was, in its view, not fit for purpose, potentially creating a fight with big media firms ahead of the election.

“The Coalition’s stubborn and short-sighted response shows they are all negativity, no plan,” the spokeswoman said.

A broad new ministry for digital affairs should be created to handle privacy, competition, online safety and other policy areas currently overseen by various ministers.

The Albanese government’s proposed new laws to tackle false information online have opened up a new political front with the Coalition, which argues the proposal gives sweeping new powers to the government and hampers free speech.

The inquiry’s final report proposed European-style laws that forced platforms to disclose how their timeline algorithms worked.

Greens communications spokeswoman Sarah Hanson-Young said Labor needed to “protect ourselves from the rampant disinformation and politics of division we are witnessing in the United States”.

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