The state Assembly has passed a bill to tax the largest technology companies for linking to news published by local newspapers and TV stations in California.
Assembly Bill 886, the California Journalism Preservation Act, passed 55-6 on Thursday with 19 members not voting and is now headed to the state Senate.
The bill is supported by many California newspapers and unions representing newspaper employees. It is opposed by independent online publishers and technology groups.
Facebook has threatened to prohibit the distribution of links to news content in California if the bill passes.
The measure would apply to online platforms with a market capitalization of $550 billion or more, which essentially means Google, Facebook owner Meta, Microsoft and Amazon.
“These dominant digital ad companies are enriching their own platforms with local news content without adequately compensating the originators,” said Assemblymember Buffy Wicks, a Democrat from Berkeley, who introduced the legislation. “It’s time they start paying market value for the journalism they are aggregating at no cost from local media.”
The bill requires 70% of the revenue from the tax to be used to fund new jobs for journalists at eligible California publications.
Among the San Diego delegation in the Assembly, David Alvarez, Brian Maienschein, Chris Ward and Akilah Weber voted in favor of the bill, while Marie Waldron voted against it and Tasha Boerner abstained.
During the floor debate, Boerner said she is concerned about the future of the news industry but questioned whether revenue from the tax would ultimately benefit journalists.
“My worry is that the funds that are going back to these large publishers are not going to actually go back to the journalists,” she said.
Matt Schruers, president of the Computer & Communications Industry Association, said, “We support a thriving news media, but cannot support a link tax. Taxes on sending internet traffic from one site to another is not a sustainable business model for any party involved, and sets a dangerous precedent for governments and carriers to impose fees on users navigating the open internet.”