The White House has fired a warning shot at Australia over its latest push to regulate global technology companies, invoking the Trump administration’s opposition to foreign fines and taxes on American Big Tech as Canberra moves ahead with sweeping new online safety laws.
The intervention comes only a day after the Albanese government unveiled its draft Digital Duty of Care, including a “My Feed, My Way” initiative designed to give Australians greater control over the algorithms deciding what they see on social media.
White House spokesperson Kush Desai said President Donald Trump had “unequivocally warned trading partners” against digital services taxes, fines and what the administration described as other forms of “extortion” targeting America’s leading technology companies.
Desai said the administration remained committed to raising those issues with US trading partners.
The language is unusually forceful and puts Australia’s rapidly expanding system of online regulation directly into a broader international dispute over how far governments should be able to regulate overwhelmingly American-owned technology platforms.
But there is an important distinction in what the White House actually said.
Desai did not specifically declare Australia’s Digital Duty of Care itself to be an act of extortion, nor did Washington announce a tariff or other retaliatory measure against Australia over the draft law.
The statement was a broader warning about digital taxes, fines and regulatory burdens on US technology companies, delivered in response to questions about Australia’s policy direction.
Communications Minister Anika Wells described the White House statement on Wednesday as broad and said no US representative had directly contacted her office to deliver the same warning specifically about the Digital Duty of Care.
She nevertheless made clear Canberra would not back away simply because American companies could be affected.
Australia says it will make its own rules
Prime Minister Anthony Albanese had already anticipated the possibility of friction with Washington when unveiling the reforms on Tuesday.
Asked about the risk of upsetting the US President, Albanese said Australia was a sovereign country and would determine policy according to the national interest.
He also sought to contain any suggestion of a broader diplomatic breakdown, saying his relationship with Trump was “very good”.
The two leaders are expected to meet in New York later this month on the sidelines of the United Nations General Assembly.
That meeting could now take place against the backdrop of a growing disagreement over technology regulation.
Australia argues that multinational digital platforms operating here must comply with Australian safety standards just as companies in other industries do.
The Trump administration has increasingly taken the opposite view when foreign rules are seen as placing disproportionate costs on US companies.
That conflict is not unique to Australia.
Washington has spent years criticising digital services taxes and European technology regulation, arguing overseas governments are unfairly targeting successful American firms to raise revenue or impose restrictions that US companies do not face at home.
Trump has previously threatened tariffs over foreign tech regulation
The White House’s latest language is consistent with a presidential memorandum Trump signed in February 2025 titled “Defending American Companies and Innovators From Overseas Extortion and Unfair Fines and Penalties”.
That directive established an explicit US policy of examining overseas taxes, penalties and regulations affecting American businesses.
It said the administration could impose tariffs or take other responsive action when a foreign government introduced measures considered discriminatory, disproportionate or designed to transfer substantial money or intellectual property away from American companies.
The memorandum also directed US officials to investigate foreign regulation that could inhibit the growth or intended operation of US companies.
It specifically raised concerns about overseas rules affecting technology services and content moderation.
That makes Australia’s Digital Duty of Care potentially relevant to a much broader US trade strategy even though no retaliatory action has yet been announced.
Most of the platforms likely to face Australia’s strongest obligations — including Meta, Google, X and other major digital companies — are headquartered in the United States.
If Washington concludes Australia’s penalties or regulations unfairly burden those firms, the Trump administration already has a policy framework under which it could consider trade responses.
Whether it actually does so is another question.
What Australia is proposing
The Digital Duty of Care exposure draft was released on September 8 as the next stage of Labor’s overhaul of online safety.
The legislation would require covered online services to identify foreseeable risks associated with their products and take reasonable steps to reduce those risks.
The approach is designed around what the government calls “safety by design”.
Rather than regulators responding only after harmful material has already circulated, digital services would be expected to consider how their own products, recommendation systems and design features may expose users to harm.
The obligations would extend beyond conventional social media.
Online games, apps, messaging services, artificial intelligence chatbots and other digital products can fall within the broader framework.
The rules would be particularly strong for children, with the government targeting content and design features associated with pornography, eating disorders, misogyny, bullying, serious mental health distress, criminal behaviour and dangerous stunts.
For adults, the government says the regime remains focused primarily on illegal material and user choice rather than creating new categories of prohibited political opinion.
Failure to comply with the duty could attract penalties of up to $109.2 million.
Wells has also said overlapping violations involving Australia’s separate social media minimum-age rules could result in penalties exceeding $200 million in some circumstances.
It is those large financial penalties that have particular relevance to Washington’s warning about foreign fines against American technology companies.
‘My Feed, My Way’ would change social media algorithms
One of the most visible elements of the proposal is the government’s “My Feed, My Way” initiative.
Social media platforms would be required to offer new and existing users aged 16 and over a clear choice about what they want as their default feed.
One option would retain personalised recommendations selected by the platform’s algorithm.
The alternative would prioritise content from friends, creators and accounts the user has deliberately chosen to follow.
Users would be able to change their preference later rather than being locked permanently into either option.
Albanese says the measure is about taking power away from large platforms and returning it to individual Australians.
He has rejected claims the proposal amounts to government censorship.
When asked on Tuesday whether the new regime could be used by eSafety or another regulator to police political commentary or misinformation, Albanese said the legislation was not about censorship.
Wells went further, saying the government could “emphatically rule that out”.
On Wednesday, she again argued that Australians would retain what she described as their right to be wrong online, using belief that the moon landing was fake as an example of speech that would not itself be banned by the duty of care.
Free speech remains part of the US-Australia dispute
Those assurances have not eliminated American or domestic concerns.
The Republican-controlled US House Judiciary Committee has previously investigated the effect of foreign online safety laws on speech originating in the United States.
Committee chairman Jim Jordan wrote to Australia’s eSafety Commissioner Julie Inman Grant in November 2025 seeking testimony about the Online Safety Act and allegations that Australian enforcement could result in American speech being restricted.
Documents subsequently published by eSafety confirm Inman Grant declined to attend the requested interview but provided the committee with a written explanation of Australia’s approach.
The dispute was partly driven by Australian attempts to require Elon Musk’s X to remove material under Australian online safety law.
The White House’s own 2025 policy memorandum similarly ordered US agencies to examine foreign regulations that could affect freedom of speech or political engagement through content moderation requirements.
Australia therefore faces two overlapping US concerns.
One is economic: fines, taxes and compliance burdens imposed on American companies.
The second is constitutional and political: whether foreign governments can effectively influence what Americans see or say online by imposing global compliance demands on US platforms.
The ‘global reckoning’ comment came from Wells
The rhetoric from Canberra has also been deliberately strong.
While Albanese fronted the announcement, it was Wells who declared that a “global reckoning” was coming for Big Tech.
She said technology companies had for too long conducted what amounted to real-time, unregulated product testing on Australian users.
The government argues platforms have become so deeply embedded in everyday life that ordinary consumer safety principles must now apply to them.
Wells compared the concept to safety standards applied to cars, toys and food.
Labor’s message is that enormous global companies should not be exempt from responsibility simply because their products are digital.
The White House’s concern is that this logic can become a justification for foreign governments imposing ever-larger costs on a predominantly American technology sector.
Those positions are increasingly difficult to reconcile.
Australia has already created another potential US flashpoint
The Digital Duty of Care is not the only Australian measure facing scrutiny in Washington.
A separate Australian law passed this year introduced a News Bargaining Incentive intended to pressure large digital platforms into commercial agreements with Australian news publishers.
Under that arrangement, qualifying technology companies that fail to enter sufficient deals can face a charge equivalent to 2.25 per cent of Australian revenue.
The Trump administration strongly opposes digital taxes that it considers discriminatory against US companies.
The White House statement supplied this week referred broadly to digital services taxes as well as fines, meaning Australia’s overall technology policy — rather than one draft bill in isolation — appears to be attracting attention.
Wells noted on Wednesday that the media questions put to the White House covered several issues, including Australian tax arrangements, before the administration supplied its broad response.
That context is important when interpreting the word “extortion”.
The language represents the Trump administration’s established characterisation of certain foreign taxes and penalties.
It should not be read as a formal legal finding that Australia’s Digital Duty of Care itself constitutes extortion.
No retreat from Canberra
For now, the Albanese government appears determined to proceed.
The draft legislation is open for consultation before the government introduces a final bill to Parliament later this year.
Labor is expected to need support from the Greens if the Coalition and One Nation oppose the legislation.
The Coalition has expressed support for giving users greater control over algorithms but has raised serious concerns about ministerial discretion and the potential for regulatory mission creep.
The Greens argue Labor has not gone far enough and want stronger protections, including tougher rules around algorithmic consent.
Technology companies themselves are also expected to push for changes to the draft.
That means the final scheme could differ from the version unveiled this week.
What is already clear is that Australia’s online safety debate is no longer purely domestic.
Canberra wants some of the world’s largest companies to redesign products, offer Australians more control and face penalties exceeding $100 million when they fail to meet local standards.
Washington has an established policy of defending those same American companies against overseas taxes, fines and regulations it considers unfair.
No Australian tariff retaliation has been announced and neither government is describing the dispute as a broader rupture in the alliance.
But the lines have now been drawn.
Albanese says Australia will regulate in the national interest.
The White House says America’s trading partners have been warned against using taxes and fines to extract money from US technology companies.
When Albanese and Trump meet in New York later this month, Big Tech regulation may therefore be more than an Australian domestic policy argument.
It may become another test of how far close allies can disagree when national sovereignty, free speech, trade policy and the enormous economic power of American technology companies collide.
