Australian Taxation Office announces ban on credit card tax payments

The Australian Taxation Office (ATO) has announced plans to ban credit card payments for tax bills starting November 30. This decision follows a recent Reserve Bank of Australia move that banned surcharges for Mastercard, Visa, and eftpos networks to save consumers an estimated $1.6 billion annually.

Industry Minister Tim Ayres defended the ATO's decision, citing the need to prevent credit card companies from “profiteering” at the expense of taxpayers. The ATO stated that as a government agency, it is inappropriate for merchant fees to be transferred to the community. The agency noted that credit card transactions accounted for only 2.3 per cent of tax payments in the 2024-25 financial year.

The policy has drawn criticism from various sectors. Small business operators have expressed concerns that they will be forced to increase the upfront cost of goods and services to cover lost surcharge revenue. Meanwhile, One Nation leader Pauline Hanson and teal MP Allegra Spender have joined in a rare unified demand for the taxation office to reverse the ban.