Rather than get into a spat with Meta and others about whether they are benefitting from publishers’ journalism, Australia is opting to go straight out with a demand for a share of their profits.

An announcement this afternoon says the media bargaining code introduced by the Morrison Coalition government would be replaced by a tax on media giants that don’t cough up.

Assistant treasurer Stephen Jones said the “tax” on social media companies would effectively be waived if they make agreements to pay news publishers. Details have not been worked out.

The new scheme saves the Albanese government the loss of face if it were unable to enforce the existing bargaining code, Meta having effectively thumbed its nose at the government by saying it doesn’t publish news and wasn’t therefore making any more agreements.

It also spares the government from a costly battle with cashed-up tech giants as it goes into an election year, while meeting the expectations of major publishers.

Jones says he expects the new law will raise the same revenue as the previous voluntary agreements – but that the hope is that it will instead incentivise them to strike deals.

The assistant treasurer said “obviously” they had consulted with digital platforms, and “made it very clear that we want to see them continue to make a contribution to journalism in Australia”.

Treasurer Jim Chalmers had recused himself from the issue as his wife works for News Corp Australia, considered an interested party.

The new law, dubbed the News Bargaining Incentive is pitched at digital giants including Google, Meta (Facebook, Instagram and WhatsApp), and ByteDance (TikTok). Companies with Australian revenue of at least $250 million are covered, and would be “made to pay for Australian journalism” – as the government puts it – even if they drop it from their platforms.

In Canada, Meta had also responded to legislation by “turning off” its news tab on Facebook and Instagram, leaving an unresolved gap.

Response from tech companies has been prompt.

TikTok – not captured under the old code – rejected the idea that they were a ‘go-to’ for news, and said it would “actively engage in the consultation process”.

Meta said that while the Morrison-era code was “flawed”, the government’s rewrite failed to understand how social media platforms work, adding that it had “concerns about charging one industry to subsidise another.

“The proposal fails to account for the realities of how our platforms work, specifically that most people don’t come to our platforms for news content and that news publishers voluntarily choose to post content on our platforms because they receive value from doing so.”

Peter Coleman