Meta has accused the Australian government of violating the Free Trade Agreement with the United States by proposing a new tax on tech giants that do not enter licensing agreements with local media. The proposed tax of 2.25% on all Australian revenue, including earnings unrelated to social media, has been labeled 'indefensible' by Meta, which argues that it breaches commitments to treat American companies equally. This tax is seen as broader than existing digital service taxes that have previously led to US trade actions. The Australian government, however, remains committed to the tax, with plans to distribute the revenue to the news media sector. This issue has been contentious since Australia enacted a law in 2021 requiring social media platforms to negotiate payments for news content. Meta had briefly blocked news feeds in Australia but later negotiated deals with major outlets, only to stop payments in 2024. The ongoing dispute highlights rising geopolitical tensions between the US and Australia regarding tech regulation.