HARRISBURG – Allegheny County Sen. Nick Pisciottano plans to introduce legislation to prohibit credit card companies from charging swipe fees on the sales tax portion of retail transactions in PA. Currently, credit card companies charge merchants interchange or “swipe” fees on the full transaction amount, including the sales tax businesses are required to collect on behalf of the state. At 2 to 4% per transaction, those fees add up quickly for small businesses operating on thin profit margins. About one-third of all purchases in the U.S. are made by credit card. Visa and Mastercard control up to 85% of the credit card market, leaving merchants with little leverage to negotiate fees. PA businesses are estimated to pay hundreds of millions of dollars a year in swipe fees, costs that are often passed on to consumers through higher prices or absorbed by small businesses themselves. The legislation would prohibit swipe fees from being assessed on the sales tax portion of a transaction. Purchases not subject to sales tax would not be affected. A co-sponsorship memo is being circulated seeking support.
SEN. NICK PISCIOTTANO