Budget sets forth Google tax, ABC cuts and license fee reduction

Nicola Riches
By Nicola Riches | 4 May 2016

A Google tax, cuts to the ABC and a commercial TV and radio license fee cut, which industry says doesn't go far enough, are the trio of budget measures likely to affect Australia's adland and media industry.

In an election pre-empting budget, treasurer Scott Morrison hardly surprised, but delivered a swathe of concrete measures which will have ramifications for the local media and advertising sector.

Firstly, a 25% reduction in commercial radio and TV licence fees, applicable from the 2015-16 licence period. Both Commercial Radio Australia CEO Joan Warner and Free TV chairman Harold Mitchell AC have said that they "welcome" the move but "the size of the cut is disappointing".

Both peak bodies have signalled intention to enter into discussions with the minister (Mitch Fifield) on further cuts later in 2016.

Perhaps more eyebrow raising is the declared intention by the government to raise an estimated $700 million in one year by stopping multinationals "artificially structuring" to move profits to low tax countries.

Known as the 'Google Tax', the Australian Tax Office will set up a separate division to deal with tax avoidance on an huge corporate basis.

Finally, the ABC overnight revealed that it will be making "changes to staffing and programming" after being hit with a funding cut of almost $20 million.

However, Morrison's budget will maintain the $3.1bn base funding for the ABC across television, radio and digital services.

The areas which will suffer cuts include the Enhanced Newsgathering Program, the National Reporting Team, state-based digital news, the ABC Fact Check unit and improvements to live-linking capacity in the regions.

Email Nicola at nicolariches@yaffa.com.au.

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