Colorado Lawmakers Consider Bill Targeting Credit Card Fees On Sales Tax

GRAND JUNCTION, Colo. (KJCT) -When shoppers pay with a credit card, merchants are charged a processing fee — and that fee applies to the total transaction, including sales tax. Those costs are often passed on to consumers through higher prices.

Now, Colorado lawmakers are considering a bill that would change that.

The measure, currently under review in the state Senate, would prohibit credit card companies from charging interchange fees on the portion of a transaction that covers sales tax.

Interchange fees are typically calculated as a percentage of the total purchase. By removing sales tax from that calculation, the bill aims to ensure businesses are not paying fees on money they are required to collect and remit to the state.

However, the proposal includes exemptions. Small banks and credit unions with less than $60 billion in assets would not be subject to the restriction.