Providing for prohibition on certain payment card network fee practices; and imposing penalties.
Summary
HB2090 would add a new chapter to Pennsylvania’s Taxation and Fiscal Affairs title to regulate how payment card networks calculate and charge fees on debit and credit card transactions. The bill focuses on interchange fees and related practices when a transaction includes sales tax, requiring payment card networks to exclude the tax portion from percentage-based fee calculations or to rebate the tax-related portion of the fee. It also bars networks from shifting costs in ways that would evade this rule, from charging disputed-transaction fees before liability is determined and written notice is given, and from penalizing merchants for setting prices in compliance with state and federal law.
The bill further requires payment card networks to accept proof of tax amounts when merchants cannot capture and transmit those amounts at the time of sale, and to promptly credit the merchant’s settlement account. It authorizes the Attorney General to seek injunctive relief, restitution, and civil penalties, and it creates a private-facing refund obligation for fees collected in violation of the chapter. The act would take effect 60 days after enactment.
Impact
HB2090 would directly affect payment card networks, acquirer banks, processors, merchants, and consumers by changing how card transaction fees are assessed on taxable sales in Pennsylvania. It would amend Title 72 by creating a new chapter governing fee practices, with the practical effect of limiting interchange fees on the tax portion of retail transactions and prohibiting certain fee pass-throughs and merchant penalties. The bill also gives the Attorney General enforcement authority and sets civil penalties of up to $1,000 per violation, along with refund obligations for improperly collected fees.
Sentiment
The available vote history suggests the bill received a favorable committee recommendation, passing the House Finance Committee 14-12 to be reported as committed. That narrow margin indicates support, but not broad consensus. No committee transcript is available, so the record does not show detailed debate, but the close vote implies the proposal was viewed as significant and potentially controversial.
Contention
The main point of contention is likely the bill’s restriction on payment card network revenue and fee-setting practices, especially the requirement to exclude sales tax from interchange fee calculations. Financial institutions, card networks, and processors may view the measure as an operational and revenue burden, while merchants and consumer advocates may support it as a way to prevent fees on tax amounts and reduce transaction costs. The bill’s prohibition on disputed-transaction fees before liability is resolved and its ban on penalties tied to lawful pricing practices may also be disputed as regulatory overreach by opponents and as merchant protection by supporters.
Excludes the amount of state and local taxes and fees from the amount on which an interchange fee is charged for that electronic payment transaction by a credit or debit card network; prohibits a payment card network from altering or manipulating the computation and imposition of interchange fees.
Excludes the amount of state and local taxes and fees from the amount on which an interchange fee is charged for that electronic payment transaction by a credit or debit card network; prohibits a payment card network from altering or manipulating the computation and imposition of interchange fees.
To Create The Second Amendment Financial Privacy Act; To Prohibit Financial Institutions And Payment Networks From Using Certain Discriminatory Practices; And To Provide For Enforcement Of Violations.