ATO will not budge after snap meeting over credit card ban

The Australian Taxation Office (ATO) will not budge on its decision to stop accepting credit card payments from December 1, after holding a snap crisis meeting with business groups angered by the move.

Australia’s tax chief convened a meeting with business groups this morning to discuss the changes in the wake of widespread backlash. But the ATO has indicated it is not going to reverse the credit card ban, according to a spokesperson from the Australian Chamber of Commerce and Industry (ACCI), which attended the meeting.

Last week the tax office announced it would stop accepting credit card payments at the end of next month. That step came in response to the Reserve Bank of Australia’s reforms to scrap card surcharges from October 1, which the bank said was “in the public interest” and would save customers about $1.6 billion a year. The ATO said it would continue accepting credit cards until November 30 to allow for a transition period, saying it was untenable beyond that point.

Small business owners say they have been expected to absorb the fees of card transactions themselves, and have lost the option of using credit card payments to the ATO as a cash flow method. Some feared the sudden change would mean they needed to source cash quickly to begin paying by debit instead, or they would be forced to go into arrears with the ATO, and that could result in enforcement against their businesses, including possible closure.

The Council of Small Business Organisations Australia (COSBOA) said it raised issues for businesses that used credit cards as a cash flow tool and said the decision “warrants a rethink”. Master Builders CEO Denita Wawn also said the surcharge card ban and other regulatory decisions were made “without consultation” and showed a “lack of practical understanding of the impact of decisions being made by this government”.