Social media giants have been put on notice they should make themselves more transparent and subject to Australian laws or face large fines or even bans.
An inquiry into foreign interference found popular platforms were being used to watch and gather information on people, repress and threaten diaspora communities and interfere with elections to promote preferred candidates and create disunity.
This included death threats, hacking attempt and surveillance of people within the Iranian, Tibetan, Chinese and Ukrainian communities.
"Vile" Russian-backed campaigns were being waged against the Ukrainian diaspora, including messages of "how they would be executed, beheaded, where their head is going to end up and so on".
Authoritarian governments in Iran, China and Russia targeted and harassed dissidents through the use of bots and troll farms - which use fake social media accounts to attack users or spread disinformation.
The Senate committee recommended the government require all social media platforms operating in Australia to meet minimum transparency principles, including labelling state-affiliated accounts, disclosing any directions they receive from governments and being open about accounts they censor or take down.
It additionally recommends extending the TikTok ban on government devices to include contractors and the work devices of people who work for nationally significant systems.
Chinese messaging and social media platform WeChat was also singled out, with the committee recommending it be banned on government devices in line with TikTok "given it poses similar data security and foreign interference risks".
Australian Signals Directorate acting director-general Abigail Bradshaw said the decision to ban TikTok from government devices was because the information collected could create "quite a unique fingerprint" of the user.
She said the popular social media app collected phone numbers, contacts, IP addresses and SIM card numbers.
TikTok officials conceded serious changes were needed after reports the company spied on United States journalists following negative stories.
The committee also called for strategies to counter misinformation and disinformation in the Indo-Pacific and empower foreign language journalists to target the malicious activity on in-language posts and platforms.
Committee chair and opposition home affairs spokesman James Paterson said Australia needed to stay ahead of the threat being posed through foreign media.
He said authoritarian nations engaged in foreign interference through popular social media platforms against a backdrop of increasing regional tensions.
"Perpetrating states use these platforms to skew public debate, undermine trust in democratic institutions, and peddle false narratives," he told the Senate on Tuesday.
"Social media is the place where news is reported, contentious issues are debated, consensus is formed, and public policy decisions are shaped.
"The health of these forums directly affects the health of our nation (and) foreign authoritarian states know this."
Senator Paterson said emerging technologies such as artificial intelligence was making foreign interference easier and Australia needed to develop the capability to counter the threat in real time.
This included a recommendation to stand up a new office to combat cyber foreign interference.
