Relating to the charging of swipe fees on certain electronic payment transactions; authorizing a civil penalty.
Summary
HB 4124 would create a new Chapter 610 in the Business & Commerce Code to regulate “swipe fees” charged on electronic payment transactions. The bill defines key payment-card terms and requires payment card networks to exclude the portion of a transaction attributable to state or local taxes and separately stated gratuities when calculating interchange and assessment fees. In practice, merchants would either receive a deduction at settlement or a rebate for swipe fees charged on those tax and tip amounts.
The bill also sets out timing rules for when deductions or rebates must occur. If a merchant can transmit tax and gratuity data at the time of sale, the adjustment must happen at settlement; if not, the network must accept later proof and issue the rebate within 180 days after the transaction and within 30 days after the merchant submits the sales data. The bill states that payment card networks are not liable for the accuracy of merchant-reported tax or gratuity data, but it prohibits issuers or networks from shifting fees onto the non-tax, non-gratuity portion of the transaction to evade the law.
Impact
If enacted, HB 4124 would change Texas law by limiting how payment card networks and issuers calculate swipe fees on taxable sales and tipped transactions. It would create a new statutory obligation for networks to exclude sales tax, local tax, and separately stated gratuities from fee calculations, and it would authorize merchants to recover improperly charged fees. The bill also gives the attorney general enforcement authority, including civil penalties of up to $1,000 per violation and injunctive relief, with penalties deposited into the general revenue fund.
Sentiment
The available legislative history shows limited recorded debate or vote activity, so there is no strong documented floor or committee sentiment in the materials provided. The bill was left pending in the House committee on Pensions, Investments & Financial Services on April 14, 2025, which suggests it was under consideration but not advanced at that point. Overall, the measure appears aimed at merchant cost relief and fee transparency, with no recorded opposition or support statements in the provided context.
Contention
The main policy issue is whether payment card networks should be required to carve out taxes and gratuities from swipe-fee calculations, which would reduce costs for merchants but could affect card-network revenue and fee administration. Another point of potential contention is enforcement and compliance: the bill places obligations on networks while also allowing later proof-based rebates when merchants cannot transmit tax and tip data at the point of sale. The prohibition on fee manipulation to offset the exclusion may also be disputed by networks if they view it as limiting pricing flexibility.
Relating to anticompetitive and other unlawful practices and to certain required disclosures relating to credit card transactions; providing a civil penalty.