Australian Business Insolvencies Surge to Highest Levels Since 2020

Rising costs and reduced consumer spending are driving a wave of business closures across key sectors.

Business insolvency rates in Australia have reached 5.04%, the highest since October 2020, with hospitality and construction sectors most affected.
CreditorWatch attributes the rise to increased living and business costs, as well as the Australian Taxation Office's efforts to reclaim $35 billion in tax debts.
Western Sydney and south-east Queensland are experiencing the highest business failure rates, with some areas exceeding 7.5%.
Despite easing inflation and rising consumer confidence, the Reserve Bank of Australia is not expected to cut interest rates until 2025.
The construction and hospitality sectors are struggling with high tax default rates, contributing to their financial instability.