Creates the interchange fee restriction act restricting interchange fees on sales and use tax or excise tax when payment is made with a credit or debit card.
Impact
The enactment of this bill would amend Title 6 of the General Laws, specifically under the Commercial Law section. It places restrictions on issuers, payment card networks, acquirer banks, and processors, prohibiting them from charging interchange fees related to the tax portions of electronic transactions. This significant change is expected to lower costs for merchants, making electronic transactions more feasible for tax payments, thus potentially enhancing compliance in the payment of sales and excise taxes.
Summary
House Bill 5582, titled the 'Interchange Fee Restriction Act', seeks to regulate interchange fees associated with electronic payment transactions, specifically exempting the sales and use tax or excise tax from such fees when payment is made via credit or debit cards. This bill is introduced in the context of increasing concerns over the financial burden that interchange fees impose on merchants, particularly regarding tax amounts. It mandates that merchants inform their acquirer bank of the tax amounts during the authorization or settlement processes to avoid these fees being applied to tax amounts.
Contention
Notably, while the bill intends to provide relief to merchants by minimizing their transactional costs, there might be points of contention regarding enforcement and compliance. The bill includes provisions for penalties, declaring deceptive trade practices for entities that violate the fee restrictions. Some critics may argue that there could be complications in the accurate reporting of tax data by merchants, possibly leading to increased administrative burdens on financial institutions involved in these transactions.
Amends outdated provisions of the banking statutes and the home loan protection act, adds consumer protections, including minimum capital requirements and limits on investments, for currency transmitters, including crypto currency.
Amends outdated provisions of the banking statutes and the home loan protection act, adds consumer protections, including minimum capital requirements and limits on investments, for currency transmitters, including crypto currency.
Creates business tax credit for, eliminates sale tax on, eliminates income tax on the sale of, and creates a 10 year tax valuation freeze on newly renovated affordable housing.
Creates the interchange fee restriction act restricting interchange fees on sales and use tax or excise tax when payment is made with a credit or debit card.