A statutory licence and revenue levy so AI companies pay Australian musicians, authors, filmmakers and visual artists when they train on their work — split between creators and a public dividend fund.
COAD's Position Paper — Funding the Dividend: A Statutory Licence and Levy Model for AI Training on Australian Creative Works (July 2026, download below) — argues Australia is being offered the wrong trade-off.
As AI companies seek certainty to invest in Australian data centres and infrastructure, one option on the table is an uncompensated copyright exemption: letting AI developers train on Australian creative works — music, books, journalism, film, visual art — without paying for it. The paper argues this would transfer decades of Australian creative output to foreign technology companies at zero price, while a blanket refusal to accommodate AI training at all risks losing the investment altogether.
COAD's proposed third way: a statutory licence that lets AI companies train lawfully on Australian creative works, priced through a modest levy on AI service revenue. Creators get paid. AI companies get legal certainty. A share of the proceeds builds toward the same kind of public dividend COAD's core pillars are designed to deliver.
On 15 July 2026 the Prime Minister announced a new Office of AI within the Department of the Prime Minister and Cabinet, to centralise AI policy coordination across Government. Copyright policy remains with the Attorney-General; the Minister for Industry and Innovation (Senator the Hon Tim Ayres) and the Assistant Minister for Science, Technology and the Digital Economy (Hon Dr Andrew Charlton MP) were named as working with the new office.
The announcement doesn't change who owns copyright policy, and COAD's proposal is not a response to it in any formal sense — but a new central AI office, alongside ministers who already hold the relevant industry, science and copyright portfolios, makes this a sensible moment to put a concrete, ready-to-legislate model in front of the people now coordinating AI policy.
Source: SmartCompany (Tegan Jones), 15 July 2026.
In the same 15 July 2026 speech, the Prime Minister said: "No company should use Australian books, music, art or news to build or train AI without the artist's control. That includes the artist's control of the price and value of their work. Anything less, is theft," and confirmed no new text-and-data-mining copyright exceptions will be introduced. Damian Rinaldi, CEO of the Australian Music Publishers association (AMPAL), welcomed the remarks and called for "practical licensing solutions" — language that closely echoes the statutory licence and levy model this page proposes.
COAD did not draft this proposal in response to the Prime Minister's remarks — the position paper and this page were already in preparation — but the alignment is real: a sitting Prime Minister naming unauthorised AI training on creative work as theft, and a peak music-publishing body calling for licensing rather than exemption, are both independent validation of the direction this page proposes, not evidence that Government has adopted it.
Source: Prime Minister of Australia, "AI in Australia's interests," media release, 15 July 2026; Complete Music Update, 15 July 2026.
Every element is built from an existing Australian mechanism — nothing here requires inventing new legal machinery.
| Element | Detail |
|---|---|
| Rate | 2–3 per cent levy on AI service revenue from Australian customers (model API access, subscriptions, AI-generated advertising services) |
| Collection | ATO destination-nexus machinery — operational since July 2017 for imported digital services GST (zero new bureaucracy required) |
| Split | 50 per cent to creators, via a designated collecting society consortium — potentially led by APRA AMCOS (music) alongside Copyright Agency (text and visual arts, which has incorporated VISCOPY since their 2017 merger); 50 per cent to a public sub-fund, quarantined within the Future Fund, compounding toward a future dividend |
| Leverage | Data centre approvals, grid connections and renewable energy agreements made conditional on scheme participation |
| Legal design | Structured as a dedicated taxation Act — mirroring the Government's own News Bargaining Incentive — to address the constitutional question explained below. The AUSFTA non-discrimination position is COAD's own assessment, not yet confirmed by formal legal opinion. |
| Metric | Near term (2027–28) | Medium term (2030–31) |
|---|---|---|
| In-scope AI revenue (Australian customers) | $4–6 billion | $10–15 billion |
| Total annual levy pool (at 3 per cent) | $120–180 million | $300–450 million |
| Creator share (50 per cent) | $60–90 million | $150–225 million |
| Public dividend share (50 per cent) | $60–90 million | $150–225 million |
Illustrative only. AI revenue from Australian customers is cross-checked against Grand View Research's estimate of Australia's whole generative AI market (US$1.5 billion in 2025, growing to US$23.4 billion by 2033) — treat these figures as an upper-bound estimate pending dedicated economic modelling, not a precise costing.
In 1993 the High Court considered a scheme with real structural similarities to this one, in Australian Tape Manufacturers Association Ltd v Commonwealth (176 CLR 480): a statutory licence paired with a royalty on blank tapes, intended to compensate rights holders for home copying. A 4:3 majority held the charge was a tax — and because the enabling Act dealt with matters beyond taxation alone, it was invalid under section 55 of the Constitution, which requires taxation Bills to deal only with taxation. Separately, the Court found no acquisition of property requiring "just terms" compensation under section 51(xxxi).
What has actually happened so far — deliberately no more, and no less, than that.
COAD's position paper was published in July 2026 and revised on 15 July 2026 to reflect the Office of AI announcement and a corrected ministerial contact list.
On 17 July 2026 COAD wrote to the Attorney-General, the Treasurer, the Minister for Industry and Innovation, the Assistant Minister for Science, Technology and the Digital Economy, the Minister for the Arts, and APRA AMCOS — setting out the model and requesting a briefing. The proposal has been put to these offices; it has not yet been considered, adopted or endorsed by any of them.
A formal legislative drafting opinion on the constitutional and trade-law questions above has been recommended and is being sought. It has not yet been obtained.
The full position paper and the one-page ministerial summary, as published — free to download, share and scrutinise.
Funding the Dividend: A Statutory Licence and Levy Model for AI Training on Australian Creative Works — the full model: mechanism, indicative revenue, Australian precedents, and an honest treatment of the constitutional question it still has to clear.
↓ Download the position paperThe short-form version prepared for ministers and their offices — the model, the numbers and the ask, at a glance.
↓ Download the summaryThe FAQ covers the copyright levy alongside every other challenge to COAD — funding, economics, fairness and precedent — answered directly.