Backlash: Why the ATO’s credit card ban missed the mark

October 18, 2026 — 2:00am

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To say that the past fortnight has been nothing short of a rollercoaster for the government feels like the understatement of the year. Unfortunately, the same could be said for Australia’s small business sector, which found itself unwittingly strapped into the same ride – and without much warning.

In case you missed it, things first kicked off when the Reserve Bank of Australia announced that it would ban surcharges on credit card payments across the board – a decision that officially came into effect on October 1. As part of this change, the Australian Tax Office announced that from December, business owners would no longer be given the option to pay their tax bills using credit cards. The reason for this, the ATO said, was that allowing credit card payments would leave an annual surcharge bill of $200 million that taxpayers would then have to foot.

As you might expect and may have seen by now, many small business owners took serious issue not just with the change itself, but the short notice that came with it.

To be fair to the government, the RBA is an independent body that makes its own decisions. But when the bank first announced that it would introduce a ban on surcharges across the board, Canberra wasted no time in hitching their wagon to the plan and spruiking it as a savings win for everyday Australians struggling with the cost of living, as if they were somehow partly to thank.

And unfortunately for them, what’s since come to light is that the government knew about the ATO’s plans ahead of time, and it was Treasurer Jim Chalmers who requested the two-month transition period after it became apparent that the tax office’s attempts to........

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