Inspired by an Illinois law, legislators in multiple states are working to ban card swipe fees on sales tax and gratuities, with proposals pushed by retailers and restaurateurs gaining momentum.
In recent years, merchants of all sizes have decried rising fees for customers’ credit and debit card transactions, propelling the efforts to curb interchange application to portions of consumer payments. Illinois enacted a law in 2024 to eliminate swipe fees on taxes and tips beginning July 1, 2025.
This year, 11 states including California, Colorado, Nevada, Texas and Vermont, are considering bills that carry “the highest threat of enactment,” according to the Electronic Transactions Association, which is hustling to block them. The ETA counts card issuers, processors and networks as members, including Bank of America, Fiserv, Mastercard and Visa.