Business News

ATO launches new protections against rising tide of fraud

Published

11 months ago

17 January 2024

Liam

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ATO launches new protections against rising tide of fraud

Australian Taxation Office

The Australian Taxation Office (ATO) has launched a suite of new protections to help secure people’s personal information amid an unprecedented rise in identity-related fraud attempts.

ATO Deputy Commissioner and Chief of the Serious Financial Crime Taskforce (SFCT) John Ford said there had been an increase in the pace and scale of criminals using people’s stolen personal information to attempt fraud.

‘Global threats, organised crime, the use of artificial intelligence and increased data breaches in the community all mean the risk of fraud is only growing,’ he said.

‘The ATO has acted decisively to help people protect themselves. Security upgrades launched this week will add extra layers of protection for those taxpayers who log in to ATO online services using the myGovID service.’

Deputy Commissioner Ford said there were simple steps people could take to better protect themselves.

‘The first step is to get a myGovID if you don’t already have one and set it at the strongest level you can obtain.

‘The second step is once you’re in myGov, authenticate your identity using myGovID to link to the ATO. These two simple steps will protect you against many forms of identity fraud.’

‘From that point on, you’ll need to use myGovID to log into ATO online services and the identity strength you have used will become the minimum level needed whenever you log in in the future.

‘For businesses with an ABN, if you appoint a tax agent or change agents, you will now get a message asking you to give permission to that agent to act on your behalf. Please do not ignore this message, especially if it’s unexpected.’

Everyone has a role in combatting fraud

Mr Ford said responding to the rise in fraud required the ATO to work with the community, tax professionals and many other partners to shut down any potential pathways for fraudsters.

‘Fraud is everyone’s concern,’ he said.

‘Those attempting fraud are sophisticated. They continually assault systems right across the community to build their expertise and find new ways of breaching defences.

‘These criminals do not care if they are targeting the ATO, a tax agent or a small business – anything and anyone is fair game for these heartless thieves.’

Mr Ford said those attempting to commit fraud against the ATO were targeting Australia’s capacity to fund health, education and infrastructure, but everyday Australians were also significantly impacted by the theft of their personal information.

‘Unfortunately, we know victims of identity fraud suffer more than just financial loss and personal anguish.

‘Necessary additional protections put in place for these victims can mean it takes longer to access services or prove their identity. ‘We understand the frustrations additional protections can sometimes cause, but we cannot make changes which risk losing Australia’s revenue or people’s personal information to criminals.’

‘We also want to thank the tax professional community, who continue to work with us to add extra protections into their business practices, such as client-agent linking. ‘They have recognised the fraud challenge, and are willingly playing their part in making the system harder for fraudsters, even where this has required some changes to their processes.’

The Australian Taxation Office (ATO) has launched a suite of new protections to help secure people’s personal information amid an unprecedented rise in identity-related fraud attempts.

Steps you can take

The ATO is asking the community to:

Be aware of where you share your personal information
Use myGovID when interacting with the ATO’s online services for Individuals, and set-up to the highest identity strength where possible
Take prompt action when you think you may have had your identity compromised, for example arranging cancellation and re-issuing of relevant government identity documents and notifying the ATO so we can add additional protections
Do not be tempted to engage in fraud – remember, if it seems too good to be true, it probably is.
Think twice when you receive an SMS or email from the ATO to consider if it is genuine – Although the ATO does occasionally use SMS or email to ask you to contact us, we will never ask you to return personal information through these channels or ask you to click a link and to sign into our online services.

Case studies in fraud

Earlier this year, a Brisbane retiree’s stolen personal information was used to open bank accounts, set up a myGov account in her name and linked that myGov account to the ATO. The criminals then lodged fraudulent Business Activity Statements (BAS) in an attempt to steal money. The woman must now call the ATO whenever she needs to access our services as enhanced protections are in place to prevent her being further victimised.
We have also seen criminals targeting tax agents. In one incident, a western Sydney-based tax agent had their identity details compromised which allowed the criminals to pose as the agent and access their clients’ records. The criminals then attempted to submit several fraudulent Business Activity Statements (BAS) in an attempt to gain millions of dollars in GST fraud. This case not only significantly impacted the agent, but also the legitimate businesses who were impacted by the fraudulent BAS statements and the fact the criminals were able to see the history of their financial interactions with the ATO.

How it works: Bolstering security when accessing ATO online services

Your Digital ID, such as myGovID, is the most secure way to access ATO online services.
A new minimum online access strength will be based on the sign in method you’ve used to access ATO online services through myGov.
You can use your online access strength to better protect your identity and increase your security when accessing ATO online services including accessing via the ATO app.
The sign in method you’ve used with the highest identity strength becomes your minimum online access strength and you’ll need to use this for all future access.
For example, if you have a myGovID with a Standard identity strength and use it as your sign in method, your online access strength will be Standard. Whenever you sign in to myGov to access ATO online services, you’ll need to use your Standard myGovID at a minimum.
Where possible, we encourage people to use myGovID and set-up a Strong identity strength which includes a facial verification check. Visit Create a myGov account and link it to the ATO for more information.

How it works: Ensuring tax professionals can only access the data of businesses they represent

This protection requires entities to ‘nominate’ their agent in ATO Online services before the agent can access their ATO data or act on their behalf with the ATO.
This client-to-agent linking process is being progressively rolled out and now applies to all types of entities with an ABN, except for sole traders, covering approximately 4.7 million businesses.

Only businesses that are looking to engage a new agent, change their existing agent, or want to provide additional authorisation to their existing agent need to complete an agent nomination.

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Business Closures Reach Four-Year High Amid Cost Pressures

Published

1 week ago

28 November 2024

Liam

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Business Closures Reach Four-Year High Amid Cost Pressures

By Ian Rogers

Business insolvencies in Australia have hit a four-year high, with rising costs and financial pressures forcing many companies to shut their doors. According to debt-monitoring firm CreditorWatch, the business failure rate rose to 5.04% in October 2024, nearing the peak of 5.08% seen during the height of the COVID-19 pandemic in October 2020.

On an annual basis, insolvency rates are now 25% higher than pre-pandemic levels.

Why Are Businesses Struggling?

CreditorWatch identified three main reasons for the increase in insolvencies:

Higher Cost of Living: Consumers are tightening their spending, particularly on discretionary items, affecting business revenues.
Higher Cost of Doing Business: Rising electricity prices, insurance premiums, rent, and wage increases have put pressure on operating costs, especially for smaller businesses.
Tax Debt Recovery: The Australian Taxation Office (ATO) is actively pursuing $35 billion in unpaid tax debts, with many affected businesses in the hospitality and construction sectors.

Sectors Most Affected

Hospitality:
- This sector had the highest failure rate, averaging 8.5% over the past year.
- CreditorWatch predicts the rate will climb further to 9.1% in the next 12 months.
Construction:
- The construction sector’s failure rate averaged 5.3%, though it appears to be stabilizing.
- Long-standing cost pressures and reduced activity due to high interest rates have strained many businesses.

Both sectors also face the highest levels of tax debt and defaults, further limiting their financial viability.

Broader Financial Challenges

The report highlighted a rise in business-to-business payment defaults, indicating that more companies are struggling to pay their bills. Arrears have increased across most industries, reflecting the cumulative impact of rising costs and economic pressures.

Ivan Colhoun, CreditorWatch’s chief economist, remarked “Unfortunately, higher costs and interest rates are leading to more arrears and business failures. It’s an expected but unfortunate consequence of the current environment.”

Will Interest Rate Cuts Help?

The Reserve Bank of Australia (RBA) is unlikely to cut interest rates at its December meeting. Rates have remained steady at 4.35% since November 2023, with economists expecting the first cuts in the first half of 2025.

While inflation fell to 2.8% in the September quarter and unemployment held steady at 4.1% in October, the RBA has signalled it won’t reduce rates until inflation drops further or unemployment rises.

Mr. Colhoun noted that even if rates are cut, the effects will take time to materialize. However, lower inflation could provide some relief by reducing cost-of-living pressures and encouraging consumer spending, potentially boosting businesses in the medium term.

Future Uncertainties

While consumer and business confidence have shown modest improvement in recent months, challenges remain:

Global Risks: A potential shift in U.S. trade policy, including proposed tariff increases on major Australian trading partners, could create additional uncertainties for businesses.
Tax Debt Recovery Delays: The impact of delayed tax cuts and ongoing tax collection efforts could exacerbate financial strain for some businesses.

The Road Ahead

While some sectors show signs of resilience, the rising insolvency rates underscore the need for continued government and industry support. Businesses in hospitality and construction, in particular, will require targeted relief and reforms to navigate these challenging conditions.

The long-term outlook hinges on broader economic stability, interest rate adjustments, and efforts to reduce operational costs for struggling businesses.

For more local news, click here.

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Business News

Business Confidence Surges as Inflation Declines, Hitting a Two-Year High

Published

2 weeks ago

20 November 2024

Liam

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Business Confidence Surges as Inflation Declines, Hitting a Two-Year High

By Robert Heyward

Roy Morgan Business Confidence rose sharply in October 2024, increasing by 12.4 points to 106.7. This marked the most positive sentiment in over two years, driven by falling inflation and growing optimism about the Australian economy and business investment.

Key Drivers of the Increase in Confidence

The October rise in Business Confidence coincided with significant declines in inflation:

Monthly inflation: Dropped to 2.1% in September, as announced in late October, down from 2.7% in August and 3.5% in July.
Quarterly inflation: Reached 2.8% for the September quarter, its lowest level since March 2021 and within the RBA’s target range of 2–3%.

This decline in inflation has improved economic sentiment and heightened expectations of future interest rate cuts, aligning Australia with trends seen in central banks overseas.

Roy Morgan Monthly Business Confidence Australia

Improved Sentiment Across Key Indicators

Financial outlook:
- 46.3% of businesses (up 5.2 percentage points) expect to be better off financially in a year.
- Only 20.6% (down 4.4 points) anticipate being worse off.
Economic outlook:
- 59% of businesses (up 6.8 points) expect “good times” economically over the next year, the highest level since February 2022.
- Confidence about the economy over the next five years also rose, with 35.6% expecting “good times” (up 4.4 points).
Investment sentiment:
- 42.9% (up 6.9 points) believe the next 12 months is a “good time to invest” in growing their business.
- Only 35.2% (down 10.4 points) consider it a “bad time to invest,” the lowest level since June 2021.

Business Confidence by State in October 2023 vs October 2024

State-by-State Analysis

Business Confidence improved across most states, with New South Wales leading at 111.6, followed by Queensland (105.7), Western Australia (105.2), Victoria (104.4), and South Australia (102.4).

Tasmania (89.0) was the only state with confidence below the neutral level of 100, reflecting political instability within its Liberal-led government.

Industry Performance

The most confident industries in September and October included:

Public Administration & Defence: 160.1 (+48.9 points year-on-year).
Education & Training: 127.3 (+6.7 points).
Finance & Insurance: 121.6 (+20.7 points).
Recreation & Personal: 112.0 (+16.9 points).
Professional, Scientific & Technical Services: 111.0 (+11.9 points).

At the lower end, industries like Transport, Postal & Warehousing (72.6), Mining (78.3), and Agriculture (85.7) reported subdued confidence, with the Transport sector consistently lagging throughout the year.

Business Confidence for Top 5 and Bottom 5 Industries in September & October 2024

Commentary from Roy Morgan CEO Michele Levine

“Roy Morgan Business Confidence surged in October, reaching its highest level since April 2022,” Ms. Levine said.

“This increase was driven by improved optimism about the economy and growing sentiment that the next 12 months is a good time to invest in business growth. The rapid decline in inflation, combined with expectations of potential interest rate cuts, has fostered greater positivity among businesses.”

Ms. Levine also noted strong performances across major states and industries but highlighted the need for targeted support in lagging sectors such as Transport, Postal & Warehousing, and Tasmania’s struggling economy.

Conclusion

Roy Morgan Business Confidence is now just 4.5 points below its long-term average of 111.2, signalling a steady recovery in sentiment as inflation declines and businesses prepare for a potentially favourable economic environment.

For more detailed insights, the Roy Morgan Business Confidence Report is available via subscription.

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Business News

NSW Businesses Poised to Shine at Global Expo in China

Published

3 weeks ago

14 November 2024

Liam

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NSW Businesses Poised to Shine at Global Expo in China

By Robert Hayward

The NSW Government is backing 29 businesses from the food, beverage, and health supplement sectors as they prepare to showcase their products at the China International Import Expo (CIIE) this week. The six-day trade show, China’s premier import-focused event, draws dignitaries and exhibitors from over 150 countries, offering NSW companies a direct connection to buyers, distributors, and potential customers throughout China.

As NSW’s largest two-way trading partner for nearly 20 years, China continues to be a top consumer of the state’s agricultural exports, valued at $3.6 billion for 2023/2024. NSW’s wine exports have also surged since the removal of import tariffs earlier this year, signalling continued growth opportunities, especially for the state’s premium food and beverage sector.

Last year’s CIIE saw NSW businesses secure $40 million in export deals, and the NSW Government is once again committed to facilitating new opportunities for expansion and success. Among this year’s exhibitors is Mrs Toddy’s Tonics from Sydney’s Northern Beaches, which will present its range of plant-based beverages, already stocked in Australian supermarkets.

Other participating businesses include Pablo & Rusty’s Coffee Roasters, Australian Vintage Wines, Balance Water, and Noumi. The CIIE will take place in Shanghai from 5–10 November 2024.

For more information about the event and the full list of NSW businesses that’ll be exhibiting visit here.

Minister for Industry and Trade Anoulack Chanthivong said:

“The China International Import Expo is a leading event on the global trade calendar and offers unparalleled opportunities for NSW exporters to connect with buyers and distributors in China.”

“We are excited to once again showcase the best from across NSW at this prestigious import-focused event, including meat from the Riverina, wine from the Hunter Valley, spirits from Wollongong, and health supplements made in Sydney.”

“China has a strong appetite for produce made in NSW, which is globally recognised for its high quality and safety standards, with demand only set to grow.”

Mrs Toddy’s Tonics Co-Founder Sophie Todd said:

“We’re thrilled at the opportunity to introduce a proudly Australian, female-led brand to China, and look forward to showcasing the Mrs Toddy’s Tonic range on the international stage.

“We know that Chinese consumers are becoming more health conscious and are turning to products with natural ingredients, so there’s enormous potential for a business like ours to establish a presence in this lucrative market.”

For more local news, click here.

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