This report, prepared for the Public Interest Journalism Initiative by the Centre for International Economics, considers the case for tax concessions to encourage additional public interest journalism, and examines the potential application of the R&D model to the news media sector.

The report makes the following observations:

• The success of a tax incentive scheme in Australia depends on the associated additionality* and magnitude of the public benefits associated with public interest journalism.
• Survey work commissioned by PIJI suggests that willingness to pay for PIJ ranges from $1.50 to $2.90 per person per month, which translates to an aggregate willingness to pay of between $380 million and $740 million per year.
• Preliminary analysis of these data for an illustrative tax incentive scheme suggests that, using additionality of 1, the benefit cost ratio could range from 0.97 to 1.90. Assuming additionality of 1.5 leads to a benefit cost ratio of between 1.46 and 2.84.

These overall results suggest that a tax incentive scheme for public interest journalism is worth serious consideration, with a number of clear avenues for further investigation.

*Additionality refers to the dollar increase in public interest journalism for each incremental dollar of government incentive (or tax foregone in the case of tax credits).