Google has threatened to pull out its search engine from Australia over the country’s new law that proposes to make the tech giant pay media outlets for the news content that shows up on its site.

The law will also cover Facebook and other tech companies. But the US tech giants have fought back, arguing the laws are onerous and would damage local access to services.

Australian PM Scott Morrison has hit back saying lawmakers would not yield to "threats".

The proposed news code would force Google and Facebook to negotiations with publishers over the value of news content, if no agreement could be reached first.

Google Australia managing director Mel Silva told a Senate hearing on Friday that the laws were "unworkable," according to a BBC report.

"If this version of the code were to become law, it would give us no real choice but to stop making Google Search available in Australia," she said.

Mr Morrison said his government remained committed to progressing the laws through parliament this year. At present they have broad political support.

The government has argued that because the tech platforms gain customers from people who want to read the news, the tech giants should pay newsrooms a "fair" amount for their journalism.

In addition, it has argued that the financial support is needed for the embattled news industry because a strong media is vital to democracy.

Australian print media has seen a 75% decline in advertising revenue since 2005, according to the government. Many Australian news outlets have shut down or cut jobs in recent times.

Google's threat to remove its primary product is its most severe yet, amid a debate that is being closely watched by other nations.