Taxing online advertising

We read a lot about the dangers of social media. That people now get their news “in a bubble” from like-minded people. That opposing views and objectivity are lost. What does this mean for journalism?

Well, firstly let’s not kid ourselves – newspapers can be just as much a bubble machine as social media. Would a teenager read the Daily Express? Would a socialist read the Daily Telegraph? The newspaper with possibly the broadest demographic appeal (but not sales) is arguably the Financial Times, being read by billionaires and trade union shop stewards everywhere.

But, the argument continues, journalism has certain standards. Truthfulness, honesty, integrity, accuracy. Speaking truth to power. The cub reporter on the local newspaper faithfully reporting from the Magistrates Court. And in some newspapers it was possible to ignore their leader articles and commentary and focus on the hard news, reported well. Of course, phone hacking has left its mark, even though the public perception is that it was mostly the fault of tabloids.

Blagging has always been a necessary tool for the investigative journalist, getting past a switchboard or a reception desk to gather information or confront a wrong-doer. It is interesting that many such investigations now post video alongside the story. News editors know that we sometimes will only believe what we see, no longer what we are told, and that in an age of skimming and multiple screens we gaze at pictures more than we readparagraphs.

Hence the argument for quality news and public broadcasting, like the BBC. It is meant to be our village water well, where everyone meets to talk, listen, learn, argue. Where there is no bubble, no sub-group, no hidden agenda.

But the BBC and its ilk are competition for newspapers, who also face competition from “free” social media. Essentially this is about how advertising has gone online, leaving newspapers behind. Advertising was always a substantial source of income for newspapers, from the houses-for-sale in the local paper to the fancy cars in the nationals. But Google and Facebook and Twitter are where the advertising money is now being spend, so that you see “sponsored” and “promoted” selling items inserted between the real stuff by real people.

In a market economy, one of the roles of taxes (and laws) is to promote social goods which the self-interested market, left to itself, would fail to produce. Stopping pollution is one example. Educating the workforce is another.

So, just a thought, but why not tax online advertising (beyond VAT) to fund the social good it threatens to destroy, namely a non-bubble, no-ads unpartisan sources of quality news? There could even be subsidies (tax allowances) for local newspapers with a decent amount of news coverage.

I guess the answer is that the struggling newspapers, trying to move online themselves and grab people’s time away from Facebook, would kick off against it. But somehow we have to find a way to tax the internet’s revenues, as well as trying to fairly tax the offshore internet companies themselves.

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