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ATO email scam follows IT failure

AAP logoAAP 14/12/2016 Paul Osborne, AAP Senior Political Writer

Despite progress in restoring online services following a hardware failure, the Australian Taxation Office has been hit by an email scam.

Although some services remained unavailable, its tax agent, BAS and business portals were back online on Thursday, after problems which began on Monday.

However the ATO has been forced to issue a warning for clients to be wary of a sophisticated new email scam.

The email purports to be from the ATO and includes the subject field: "Incoming Report/Action required/PI Documents".

IT security service Mailguard said on its blog tens of thousands of ATO clients had been hit by the scam.

The attachment to the email is a Microsoft Word macro capable of downloading a Trojan - a type of malware designed to allow remote, unauthorised access to a computer.

The ATO said on its Twitter feed it was receiving "increasing reports of new scam emails" and any attachments should not be opened.

ATO acting chief information officer Steve Hamilton said progress was being made on getting online systems functioning.

"We have done what we can to restore priority services and acknowledge there is a significant amount of work to stabilise our IT environment and bring remaining applications back online," he said.

The ATO was also working to restore system and application-related data affected by the outage.

But Mr Hamilton said no taxpayer data had been lost.

Refunds would be fast-tracked where possible in the lead-up to Christmas, he said.

Labor frontbencher Andrew Leigh said it was the second major government IT failure in four months, following the Census debacle.

Dr Leigh said it was especially difficult for small business owners seeking to make the most of the pre-Christmas period.

"It's a big time for them and this is taking them away from their customers," he told AAP on Thursday.

He said Prime Minister Malcolm Turnbull promised to be the most tech-friendly leader in history but had "failed to deliver".

"This undercuts peoples' confidence in shifting online," he said.

The fault was not due to external factors but a type of failure in storage hardware that contractor Hewlett-Packard Enterprises had not encountered anywhere in the world.

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