Meta has accused Australia of breaching its free trade agreement with the United States, escalating a long-running dispute over whether major technology companies should pay local news publishers for content shared across their platforms.
Meta said Australia’s proposed tax on certain tech giants that do not strike licensing deals with local media violates the U.S.-Australia Free Trade Agreement.
Meta says proposed tax violates free trade rules
The dispute centers on Australia’s proposed “news bargaining incentive,” which would apply to certain tech companies that refuse to reach commercial deals with local news media.
Reuters reported that Meta, the $1.6 trillion owner of Facebook and Instagram, said the proposal would tax platforms 2.25% of all Australian revenue, including revenue unrelated to social media. Meta described that model as “indefensible” and argued that it goes further than other digital services taxes that have previously drawn U.S. government responses.
Meta said the tax “plainly violates” commitments under the U.S.-Australia Free Trade Agreement, which requires Australia to give American companies treatment “no less favourable” than Australian peers, according to Reuters.
Australia says money would go to news media
The Australian government is not backing away from the plan.
Channel News Asia reported that a spokesperson for Assistant Treasurer Daniel Mulino, who would oversee the tax, said the government remains committed to the change. The spokesperson also said any takings from the tax would be distributed back to the news media industry.
The proposal is the latest attempt by Australia to make large digital platforms compensate local publishers. The issue has been a point of conflict since 2021, when Australia became the first country to pass a law forcing major platforms to negotiate payment deals with news outlets or face government arbitration.
Meta’s fight with Australia dates back to 2021
Meta’s latest warning follows years of tension with Australian regulators.
After Australia passed its news bargaining law in 2021, Meta briefly blocked news feeds in the country before agreeing to deals with most major media outlets. However, in 2024, Meta said it would stop paying for news.
Instead of immediately installing an arbitrator under the old system, the Australian government shifted toward a new tax model. The proposal expanded the list of affected companies from Meta and Google to Meta, Google, and TikTok.
Google had previously struck deals under the old model but has also opposed the proposed tax.
U.S. trade pressure becomes part of the dispute
Meta’s warning adds a geopolitical layer to what began as a media-payment fight.
Under the current Trump administration, Australia’s efforts to regulate mostly U.S.-based tech companies have become a flashpoint. A U.S. congressional committee has also called for Australia’s internet regulator to testify about what it described as a regime of censoring American free speech.
That wider political context matters because Meta is no longer arguing only about the cost of paying publishers. It is now framing Australia’s proposal as a trade issue involving American companies and bilateral commitments.
Tech regulation becomes harder for U.S. allies
Australia’s proposal shows how difficult it has become for governments to regulate global tech companies without creating trade friction.
For Australia, the goal is to support local journalism by making platforms that benefit from news content contribute to the media industry. For Meta, the proposed tax is too broad because it would apply to total domestic revenue rather than only revenue linked to news or social media.
The case could also influence other governments considering similar models. Meta’s message is clear: if countries tax digital platforms too aggressively, the company may frame those rules as trade barriers, not just domestic regulation.
For now, Australia is still considering industry submissions. But Meta’s latest challenge suggests the fight over news payments has moved beyond platform policy and into the larger debate over how far governments can go in forcing Big Tech to fund public-interest media.
