Politics · Australia · 2 days ago
Australia delays ATO credit card payment ban until June 2027
Australia’s government has delayed a plan by the Australian Taxation Office (ATO) to stop accepting credit cards for tax bills.
Treasurer Jim Chalmers said the government would provide extra funding so payments can continue until June 30, 2027.
The ATO had planned to stop taking credit cards after a Reserve Bank of Australia ban on card surcharges took effect.
The ATO said card fees would cost it almost $200 million a year, and it could not pass those costs on to taxpayers.
Some small businesses use credit cards to manage cash flow, and about 5% use them to pay tax bills.
Business groups and politicians criticised the planned ban, prompting the government to intervene.
The delay is intended to give the ATO time to consult small businesses, while the funding cost is due to be finalised in a December budget update.
Treasurer Jim Chalmers said the federal government would fund the Australian Taxation Office to delay its planned end to credit card payments for tax bills.
The delay followed criticism from small businesses, business groups and opposition politicians after the ATO announced the change.
The government said the extra funding would allow the ATO more time to consult small businesses.
Chalmers said the ATO would continue accepting credit card payments until the end of June next year.
The ATO said card payment fees were expected to cost it almost $200 million a year.
- Who
- Treasurer Jim Chalmers and the federal government. The ATO will continue accepting credit card payments for tax bills.
- What
- The government will provide extra funding to delay the ATO’s planned end to credit card payments.
- When
- Chalmers announced the delay on Friday, October 9, 2026. The ATO had planned to stop accepting payments from November 30 or December 1.
- Where
- Australia.
- Why
- Small businesses criticised the planned change, and the government said the ATO needed more time to consult them. The ATO said it could not absorb the card fees.
Federal government
Opposition
Delay to credit card payments ban
Federal government
The government funded a delay so the ATO could keep accepting credit card payments while consulting small businesses.
Opposition
Opposition leader Angus Taylor called for the ban to be scrapped rather than delayed.
Policy response
Federal government
Chalmers said the extension would give the ATO time to get the policy right.
Opposition
Taylor said the delay would only postpone the effect on businesses, while shadow treasurer Tim Wilson said Labor had failed to consider the consequences of the surcharge ban.
We’ve stepped in to ensure that the tax office can take credit card payments until the end of June next year
Meeting the cost of surcharges through additional public funding for the ATO would have the same ultimate outcome
Instead of screwing businesses today, they’ve decided they’re going to screw them … at least in nine months’ time
This is a win for small business and a welcome reprieve, but small businesses remain under significant pressure.
The Albanese government announced it was prepared to ban credit card surcharges.
Credit card surcharges were banned, and the ATO announced it would stop accepting credit card payments for tax bills.
Chalmers announced extra funding to delay the ATO’s planned end to credit card payments.
The ATO is to continue accepting credit card payments under the announced extension.
- ATO fees
- Almost $200 million a year, according to the tax commissioner
- Small businesses using credit cards for tax
- About 5 per cent, according to the ATO and estimates cited by the Guardian
- Planned ban date
- November 30 or December 1, 2026, according to different articles
- Delayed end date
- June 30, 2027, according to the Daily Mail; Chalmers described it as the end of June next year
- Surcharge ban savings estimate
- About $1.6 billion annually for consumers, according to the Reserve Bank of Australia
Sources
Labor's surcharge headache exposes a government on the back foot
Chalmers’ credit card back-down unedifying and concerning
Jim Chalmers announces credit card payment ban will be delayed as Albanese government is forced to step in after ATO sparked outrage
ATO delays credit card ban as government backs down after business backlash
Caucus dismay as economists issue inflation warning on surcharge ban
Jim Chalmers overrules ATO’s controversial ban on credit card payments following business outcry
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