![\"ATO](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/bfbec580-2bbd-11f1-bf7c-20850a947d8d.png\")
The ATO is currently trying to claw back $50 billion in unpaid taxes, with nearly two thirds owed by small businesses. (Source: ATO\/Newswire) <\/p>\n The ATO is currently trying to claw back $50 billion in unpaid taxes, with nearly two thirds owed by small businesses. (Source: ATO\/Newswire) <\/p>\n
The Australian Taxation Office (ATO)<\/a> has indicated it will take a \u201cpractical and proportionate\u201d approach to clawing back unpaid tax debt<\/a> during the fuel crisis. Small business groups have warned surging costs are adding to the pressure facing small businesses<\/a> and have called for a more lenient approach to debt collection.<\/p>\n The war in the Middle East has sent fuel prices skyrocketing across Australia, with the impact being felt across the economy<\/a>. Many small businesses are feeling the brunt of rising fuel costs<\/a> and uncertainty around supply.<\/p>\n The ATO has more than $50 billion in unpaid debt<\/a> it is trying to claw back, with nearly two-thirds belonging to small businesses. The tax office has ramped up its repayment efforts<\/a> after temporarily pausing its recovery action during the pandemic.<\/p>\n RELATED<\/p>\n But now, it says it will be responsive to the current fuel crisis<\/a>.<\/p>\n \u201cThe business community, including small businesses, can be assured that the ATO will take a practical and proportionate approach to administering the taxation law,\u201d a spokesperson told The Australian Financial Review<\/a>.<\/p>\n \u201cThe ATO understands some small businesses may be facing challenges associated with rising fuel costs and uncertainty around supply.<\/p>\n \u201cWhere a business is genuinely experiencing cash flow difficulties, we encourage them to contact their bank or credit provider, speak to us, or speak with their registered tax professional early.\u201d<\/p>\n The Council of Small Business Organisations Australia (COSBOA) has been calling on the ATO, along with banks, to take a more proportionate approach to help ensure small businesses can maintain cashflow<\/a>.<\/p>\n COSBOA CEO Skye Cappuccio said for businesses operating on tight margins, even small increases in fuel costs could have a direct impact on cashflow and day-to-day operations.<\/p>\n \u201cFor tradies, delivery operators, farmers and regional retailers, fuel is not discretionary. It is a daily cost of doing business,\u201d she said.<\/p>\n \u201cWhen fuel prices rise, those costs flow directly into transport, logistics and service delivery, and, where they can, through to customers.\u201d<\/p>\n Cappuccio said fuel was just \u201cone part of a bigger picture\u201d, with small businesses already managing rising energy, insurance, wage and compliance costs. It’s been warned that this could push many small businesses to breaking point.<\/p>\n It comes as the Australian Restaurant and Cafe Association calls on cafes, restaurants, pubs and other venues to introduce a temporary 1 to 5 per cent fuel levy surcharge<\/a> for diners to combat surging fuel prices.<\/p>\n The RBA\u2019s latest Financial Stability Review found company insolvencies have stabilised over the past year, but remain elevated in some industries such as hospitality and construction.<\/p>\n However, it warned there was growing pressure on small businesses managing unpaid tax debt<\/a> as enforcement actions resume.<\/p>\n \u201cConsistent with this, the share of insolvent firms with large debts owing to the ATO has increased notably over the past three years,\u201d it said.<\/p>\n There were 9,618 insolvencies for the 2025-26 income year to March 8. That included 2,324 company insolvencies in the construction industry and 1,432 in the hospitality industry.<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n