Australians have paid billions of dollars in illegal traders’ fees for federal government services for at least two decades.
The charges have been made for the use of credit and debit cards to pay for federal services, including passports, visa applications and tax bills, Nine newspaper reported.
The issue came to light after the New South Wales government realized that 92 million transactions had attracted $144 million in illegal trading fees since 2016, prompting a review by the Albanese government of federal payments.
However, Nine says there will be no refund for microcharges due to the challenges of auditing small business rates in government services for so many years.
Finance Minister Katy Gallagher said in a statement that the Albanese government would legislate to end the ATO and Services Australia debit surcharges from January 1.
“This new legislation will provide the Minister of Finance with the power to quickly and efficiently amend the Commonwealth’s surcharge policies, including to prevent Commonwealth agencies from applying surcharges to debit cards,” he said in a statement.
‘These bills will not impose new surcharges, but will fix the historic problem of ensuring that existing surcharges are authorized by legislation.
‘As the Reserve Bank completes its important work on reviewing surcharges and how payment rates can be reduced across the economy, we will stop passing surcharges on to debit from the ATO and Services Australia to ensure these everyday payments don’t cost Australians more. ‘
The charges have been made for the use of credit and debit cards to pay for federal services, including passports, visa applications and tax bills.
The practical benefit for Australians is that they will save money because they won’t be charged a fee simply for using their debit card.
Commonwealth law prohibits the government from charging payment surcharges when people pay a tax or levy, according to legal advice provided to Ms Gallagher.