Australia's Small Businesses Face Dual Card Payment Overhauls in 60 Days

Australia's small businesses are facing two major changes to card payment systems in just 60 days. The first change took effect on October 1, when the Reserve Bank of Australia (RBA) banned surcharges on payments made via eftpos, Mastercard, Visa, or American Express. This reform removes the ability for businesses to add extra fees for card transactions, though other surcharges like weekend or public holiday fees remain allowed. The second change, set for November 30, 2026, will see the Australian Taxation Office (ATO) stop accepting credit card payments for tax bills, including BAS, PAYG, and income tax.

The surcharge ban means businesses can no longer itemize card payment fees separately. According to the RBA, these costs must now be absorbed into overall pricing or margins. The ATO's decision to end credit card payments is aimed at preventing the transfer of merchant fees to the community. While only 2.3% of tax payments were made by credit card in 2024-25, the change will impact businesses that use cards to manage cash flow, particularly those with ATO payment plans linked to credit cards.

The Council of Small Business Organisations Australia (COSBOA) has expressed concern about the timing of these changes, noting that many small businesses are already struggling with high costs and tight margins. COSBOA CEO Skye Cappuccio emphasized the need for flexibility during the transition, especially for businesses relying on credit cards for payment plans. The ATO has indicated it will communicate directly with affected taxpayers to facilitate the shift to alternative payment methods.

For businesses, the immediate tasks are auditing payment systems to ensure compliance with the surcharge ban and updating ATO payment plans before the November 30 deadline. The changes highlight a broader restructuring of card payment costs in Australia, with small businesses bearing the brunt of these adjustments.