So Facebook has joined Google in agreeing to pay for Australian news content.
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Dragged to the negotiating table after their no-news tantrum! Perhaps now they could decide to pay their fair share of tax in Australia.
I would hope that Australians who really cared about news would abandon Facebook and go straight to the source.
Subscriptions to The Daily Advertiser, the Sydney Morning Herald, Daily Telegraph or The Australian are quite affordable.
Getting all the news, not just the items that the American tech giants think you should see, is a very good reason for reading your news untouched by American internet giants. The whole story, with all the detail, provides a better understanding than sensational "click bait" headlines.
Next goal for the government should be tax. American companies like Google and Facebook pay little tax in Australia, but pull billions in advertising away from traditional sources such as print, radio and television which have to pay the full company tax rate in Australia.
Advertising pays for much of your newspaper and all of your free-to-air television. Yet both Google and Facebook thought that it was OK to bring you news, that others had sourced, but not pay for it.
Worse, their "algorithms" decide what you will be allowed to see based on what you have looked at previously. They think you needn't know the rest!
Google has partly come to the table over tax.
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The Australian Financial Review (AFR) revealed in May, 2019, that Google was "still battling the Australian Taxation Office (ATO) over a bill it was hit with two years ago, as it declares $4.3 billion - mostly in advertising revenue from its local customers - that is not being taxed in Australia.
"The low-tax nation of Singapore has long been in favour with the tech giants ... Google and Facebook ... But for the year ending December 31, (2018) Google had a corporate tax expense of only $26.5 million in Australia, and Facebook paid just $11.8 million.
"It (Google) has argued that Google pays most tax where its core business development and decision making takes place - in the United States"!
Facebook is facing tax battles in several countries, "under scrutiny from several other regulators in the US, Ireland, Belgium and Germany," according to the AFR. France has challenged Facebook's clever use of lower-tax Ireland.
And GST? Facebook's official advice reads, "From August 2018, Facebook ads in Australia sold by Facebook Ireland LTD are subject to goods and services tax (GST) at the applicable local tax rate."
From August 2018? So Facebook had been dodging GST, too, by working via an international address? Meanwhile, Australian competitors paid GST. Let's have real outrage about this company.
And the tax battle is not over yet. Neil Chenoweth, a senior writer for the AFR, reported as late as last September, "Australian media groups pay a tax rate up to 100 times greater than Facebook and Google on their local earnings with an estimated $6 billion in Australian-sourced earnings not taxed here, latest corporate filings show."
I would hope that Australians who really cared about news would abandon Facebook and go straight to the source.
So here at The Daily Advertiser, we pay up, but Google and Facebook diddle Australians of $6billion in untaxed earnings? Chenoweth's report goes on say that, "Google and Facebook report less than a fifth of their Australian-sourced income as local sales; and they pay no GST on most of that.
"Facebook is particularly coy with its numbers, reporting Australian cash revenue of only $709.5 million last year, of which only $167 million was Australian revenue. Drilling down, Facebook Australia "bought" advertising inventory from Facebook in Ireland for $508 million, and resold it in Australia for $674 million," Chenoweth goes on.
All these big digital companies are the same. Chenoweth adds, "In 2018 Amazon stopped supplying US products here when it was required to charge GST on products sold into Australia, but the ban today has minimal impact." In other words these giants can be reined in. They will still make money out of operating in Australia.
Facebook is not a good corporate citizen, and no friend of Australia, if we accept Chenoweth's tax avoidance reports.
It might be time for Australians, through action by the Australian Taxation Department, to unfriend Facebook.