The government has illegally charged Australians billions in merchant fees.

The Australian government has recently taken action to put an end to the illegal merchant fees that have been affecting citizens for years. These fees have been charged on various government transactions, such as passport renewals, visa applications, and tax bills, when payment was made through a debit card. It was first reported by 2GB Drive radio host Chris O'Keefe that these fees have been in place since the John Howard government era.

The issue was brought to light after a similar discovery was made in New South Wales last October. It was found that the state government had collected a whopping $144 million in illegal fees over an eight-year period. As a result, a multi-agency taskforce was set up to investigate the matter on a federal level. Unfortunately, it has been determined that there are no plans to refund those who have been charged these fees, as it would be difficult to audit across all government services over such a long period of time.

In an effort to address this issue, Finance Minister Katy Gallagher has announced that laws will be introduced on Monday to make these fees legal retrospectively. However, starting January 1, 2025, debit card fees will no longer be charged. A joint statement from Gallagher, Treasurer Jim Chalmers, and MP Andrew Leigh has been released, stating that the new legislation will give the finance minister the power to quickly and efficiently amend Commonwealth surcharging policies. They also assure that there will be no new surcharges imposed, but rather a fix to ensure that existing surcharges are authorized by legislation.

Meanwhile, the Reserve Bank of Australia is currently conducting a review on surcharging and how payment fees can be reduced across the economy. In the meantime, the government has made the decision to stop passing on debit surcharges from the Australian Taxation Office and Services Australia, in order to prevent everyday payments from becoming more costly for Australians. It's worth noting, however, that charges for credit card payments will still remain in place.

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