The Federal Government is moving to establish what it is describing as a News Bargaining Incentive to ensure giant tech firms such as Meta (Facebook), X, TikTok and Google pay for news even if they don’t put it on their platforms.

A new tax, which would also apply to Apple and Microsoft, will force tech firms to contribute to Australian journalism.

However, the tax can be completely avoided if they enter into agreements directly with media companies, as some did in 2021.

The News Media Bargaining Code was introduced in 2021 to incentivise digital platforms to enter into commercial deals with news publishers.

It acknowledged that large digital platforms are unavoidable trading partners for Australian news media businesses in reaching audiences online.

The code also sought to address the imbalance of bargaining power between digital platforms and news media publishers.

But the government now says that the code has limitations, allowing platforms to avoid their obligations by removing news.

Meta has already threatened not to renew the agreements on their expiry.

Communications Minister Michelle Rowland and Assistant Treasurer Stephen Jones said on Thursday (12 December) that this kind of development was not in the best interest of Australians.

The Ministers said a significant proportion of Australians use digital platforms to access news, and the government wants that to continue.

“The Albanese government is committed to a diverse and sustainable news media sector, given this is critical to the health of Australia’s democracy,” Ms Rowland said when releasing the policy.

“Large digital platforms have an important role to play in providing access to news for all Australians and contributing to the sustainability of public interest journalism.

“The News Bargaining Incentive is an important step towards securing support for Australia’s news media.”

The government does not intend to raise revenue from this policy, as the bargaining incentive includes a charge and an offset mechanism.

Platforms that choose not to enter or renew commercial agreements with news publishers will pay the charge. However, platforms with these agreements can offset their liability.

Mr Jones said the rapid growth of digital platforms has disrupted revenues in Australia’s media sector, which threatens the viability of public-interest journalism.

The government is taking action to address this by establishing the News Bargaining Incentive, which encourages digital platforms to enter into or renew commercial deals with news publishers.

“The government wants Australians to continue to have access to quality news content on digital platforms,” Mr Jones said.

“Digital platforms receive huge financial benefits from Australia, and they have a social and economic responsibility to contribute to Australians’ access to quality journalism.

“This approach strengthens the existing code by addressing loopholes that could see platforms circumvent their responsibility to pay.”

The incentive will apply to large digital platforms operating significant social media or search services, irrespective of whether or not they carry news.

The Minister said big tech companies operating in Australia should contribute to the sustainability of news media in Australia.

“A strong and diverse news sector is vital for a healthy democracy,” they said.

“The incentive builds on significant work underway to ensure Australian laws keep pace with digital technologies, including the development of a new scams prevention framework, a digital competition regime, implementation of privacy reforms, and ongoing work related to artificial intelligence.”

The government will consult stakeholders on the scheme’s final design. A public consultation paper is expected to be released in early 2025.

Meta has already stated the new proposal doesn’t account for how its platform works and that people don’t come to it specifically for news content.

It expressed a concern that the incentive was merely “charging one industry to subsidise another”.

Meta says news publishers “voluntarily choose” to post content on its platform because they understand the value they receive in doing so.