Per the 2016/17 MYEFO, effective from 1 July 2017, the ATO will be given the power to disclose tax debt information to credit reporting bureaus where taxpayers have not previously engaged with the ATO in relation to the payment of their debts.
Initially, the new measures will only be used in relation to business related tax debts where the amount of the tax debt is at least $10,000 and at least 90 days overdue. However, there is potential for these measures to be used more widely going forward.
For businesses that have unpaid tax debts from 1 July 2017, this new measure could have significant ramifications where the business subsequently seeks to secure funding. Effectively, businesses that have tax debts recorded on their credit report ratings will find it harder to borrow funds, may be required to provide additional security and may incur higher interest charges on those loans.