Controversial billionaire Elon Musk has called the Australian government “fascists” as it attempts to crack down on deliberate lies spread on social media.

Under proposed laws unveiled by the Commonwealth on Friday, could be fined up to 5 per cent of their annual turnover if they fail to protect users.

Banks and telcos would also be targeted, with fines of up to $50 million for flouting the laws.

Under the legislation, the government would be able to prescribe codes in high-risk sectors, forcing businesses to act against scammers and offer internal dispute resolution mechanisms for customers.

Placing the onus on businesses such as social media platforms is intended to pressure them to do more to stop scams at the source by weeding out fraudulent advertisements, for example.

Musk, who owns social media platform X, responded to a post about Australia’s measures with one word on Friday.

“Fascists,” he wrote.

Bloomberg noted earlier this year the advertising revenue at X has tanked since Musk took over. It was down by almost 40 per cent in the first half of 2023, compared to the same period in 2022, with the company losing an estimated $US456 million ($A681 million) in the first quarter of 2023 alone.

Asked about Musk’s comment, government frontbencher Bill Shorten hit back.

“Elon Musk has more positions on our free speech than the Kama Sutra,” he told the Today show on Friday.

“When it’s in his commercial interests, he is the champion of free speech; when he doesn’t like it, he’s going to shut it all down.”

Fascists https://t.co/NQcR9justJ

— Elon Musk (@elonmusk) September 12, 2024

Assistant Treasurer Stephen Jones, announcing the proposed legislation, also took aim at Musk. He said the outburst was “crackpot stuff”.

“Whether it’s the Australian government or any other government around the world, we assert our right to pass laws which will keep Australians safe – safe from scammers, safe from criminals,” he told ABC News Breakfast.

“For the life of me, I can’t see how Elon Musk or anyone else, in the name of free speech, thinks it is OK to have social media platforms publishing scam content, which is robbing Australians of billions of dollars every year.

“Publishing deepfake material, publishing child pornography. Livestreaming murder scenes – I mean, is this what he thinks free speech is all about?”

It’s not the first time Musk has battled against Australian authorities.

In April, the eSafety Commissioner issued an edict to X (formerly Twitter), to remove graphic content after clips of Sydney Bishop Mar Mari Emmanuel being stabbed remained on the platform.

During the months-long saga, Musk accused the Australian government of suppressing free speech.

Several politicians hit back then as well, with Prime Minister Anthony Albanese labelling him an “arrogant billionaire”.

But in June, the safety commissioner discontinued the Federal Court proceedings.

The proposed legislation has been broadly welcomed elsewhere, including by the Australian Financial Complaints Authority. It would operate an external dispute resolution scheme for scam complaints made under the government’s framework.

“This will greatly assist consumers affected by a scam,” AFCA chief ombudsman David Locke said.

“As an established external dispute resolution scheme that receives more than 100,000 complaints per year, we have experience in managing and resolving scam complaints.”

Businesses would also be required to share information about scammers across the industry and with the government in a timely manner.

The Australian Banking Association also welcomed the draft laws, saying only a collective effort from government and private enterprise would win the war against scammers.

“These codes must address the core problem of people being exposed to scams in the first place,” association chief executive Anna Bligh said.

“That means ensuring telcos and the social media platforms have strong protections in place to stop scams reaching Australians.”

The government spent more than $154 million in its past two budgets to tackle scams. Scam losses fell year-on-year in 2023 after rising consistently every year since 2016.

The public can submit responses to the draft legislation until October 4.

-with AAP