The Australian Parliament has passed a bill imposing a tax on major tech companies' use of news content. The tax is reduced or waived when companies enter into direct contracts with Australian media outlets and make payments for the content, while companies that do not enter into such contracts will be taxed at 2.5% of their advertising revenue. The measure applies to 4 companies—Google, Meta, TikTok and LinkedIn—and implementation procedures are under way. This article covers the bill's enactment and the conditions for its application.
On the 20th, the Australian Parliament passed a bill allowing taxes to be imposed on the use of Australian media news content by IT companies, including US-based Google, that provide search services. The bill sets out a system under which the tax is reduced or waived if an IT company enters into a direct contract with media outlets to pay for news content, following the necessary procedures for its implementation.
The 4 companies currently covered are Google, Meta, TikTok and Microsoft-owned LinkedIn, which have high advertising revenue in Australia. If they do not enter into contracts to pay for news content, they will be taxed an amount equivalent to 2.5% of their advertising revenue. The rate in the government's original proposal was 2.25%, but it was raised during deliberations.
Tax revenue is expected to be distributed among media companies. To avoid paying the tax, an IT company will need to enter into contracts with 8 Australian media companies. The law enacted in 2021 prompted efforts to avoid payments by ceasing to publish articles, and the latest legislation is intended to close that loophole.