Labour have unveiled some great proposals for press reform but I have major issues with the "Tech Tax" proposal. It's nowhere near as destructive as calls for an NHS tax but it's problematic in its own right.
For a start it makes what are noble and useful programmes reliant on the profits of big tech companies. Functionally these two things are totally separate, spending on these programmes should have nothing to do with taxing tech giants
In functional finance terms taxing tech companies does not free up any space to spend on other programmes. The government spends by crediting accounts and taxes merely take back money that was already created etc.
If those taxes on tech giants are cut or if the tax take is too low (more on that in a second), it provides political cover for future governments to roll back these programmes when there is no functional need to.
Which brings me onto my next point, Labour have rightly singled out tech giants because they view their monopolistic behaviour as being detrimental to the state of media and discourse.
But by creating a funding pool for more socially useful activities out of these companies profits, they are relying on the thing that they condemn. This issue comes up with carbon taxes, social wealth funds etc.
If you are going to tax something that you see as detrimental, the purpose shouldn't be to raise money, it should be the opposite. The less money that govts raise from a carbon tax the better, because it means emissions are being discouraged!
Same for a social wealth fund, by saying you want to fund social programmes through capital gains and profits you are relying on exorbitant and exploitative profit rates!
This is where we have to take tech giants seriously as monopolies. We need strong anti-trust enforcement, regulation etc.
