Official portrait of Australian Prime Minister Anthony Albanese by Australian Government is licensed under Creative Commons Attribution 4.0 International license.
Australia has found a new way to tax American success. On August 13th, the Australian parliament introduced the News Bargaining Incentive, which forces large search and social media platforms to cut deals with Australian news publishers or hand over 2.5% of their Australian advertising revenue. Canberra calls it support for journalism. It is a shakedown, and American companies are the mark.
Rather than letting digital platforms and news publishers to negotiate freely, Canberra wants to put its thumb on the scale. The government raised the number of publishers a platform must sign from six to eight — more deals, more pitfalls, less room to say no. That is not a nudge toward voluntary negotiation. It is a gun to the head. And it is unnecessary: Google already has agreements with more than 90 Australian news businesses. Platforms are making deals. Australia’s answer is to punish them for not making enough.
Then there is the fraud at the center of the bill. To sit at the bargaining table, a newsroom must register with the Australian Communications and Media Authority — which requires at least $150,000 in revenue. Thirty-five percent of the Local and Independent News Association’s members, representing over 100 newsrooms, do not clear that bar. The bill would only give them 5% of the tax revenue as a consolation prize. The struggling local newsrooms invoked in every press release about this law are the one group it leaves out. The winners are Australia’s largest media conglomerates, which never needed the help.
The discrimination is just as blatant. The tax applies to platforms earning $250 million in Australian gross revenue — a threshold that sweeps in companies hosting no news content whatsoever. Why should a platform that has never touched a news article subsidize Australian publishers? The answer is obvious once you look at who pays: Meta, Alphabet, LinkedIn. American firms. Smaller foreign competitors walk free. The law is facially neutral and functionally a tariff on U.S. technology.
That is precisely what Section 301 exists to stop. The U.S. Trade Representative can investigate and retaliate against foreign practices that burden American commerce, and this one checks every box. The tax is extraterritorial. It hits revenue rather than income. It targets a narrow class of successful firms and penalizes them for innovating. There is a reason the USTR flagged the News Bargaining Incentive in its March Foreign Trade Barrier Report: Washington already recognizes that measures like this can function as trade barriers. Section 304 also permits the USTR to act when a trading partner denies American rights under an agreement — and the United States-Australia Free Trade Agreement obligates both countries to treat each other equally in cross-border services, electronic commerce, and investment. Australia signed that agreement. This tax breaks it.
An ally does not extract hundreds of millions from American companies through a tax engineered to guarantee they are the only ones who pay it. Canberra cannot expect successful American corporations to act as piggy banks for faux-populist policies. Given the current state of geopolitics, the Albanese government should be finding ways to encourage and support the Australia-United States alliance. This incentive actively harms this. Ambassador Jamieson Greer needs to invoke Section 301 of the 1974 Trade Act — and to make clear that the United States will not let Australia profit from hostility toward American enterprise.
