Monroeville, Pennsylvania – February 26, 2027 − Condition Senator Nick Pisciottano (D-Allegheny) announced today that he has distributed the file co-sponsorship note regarding regulations prohibiting credit card issuers from charging sales tax on retail transactions in Pennsylvania.
Currently, credit card companies charge merchants interchange, or “swipe,” fees for the full amount of the transaction, including sales tax, which the companies must collect on behalf of the Commonwealth. These fees, ranging from 2 to 4 percent per transaction, add up quickly for petite businesses operating on slim profit margins.
“Small businesses are being charged taxes that they don’t even keep,” Pisciottano said. “When a family spends $100 at a restaurant and pays $6 in sales tax, the business has to send that $6 to the state. But the credit card company charges a fee on the full $106. It’s just not fair.”
According to the Federal Reserve, about one-third of all purchases in the United States are made by credit card. Visa and Mastercard control more than 80 to 85 percent of the credit card market, leaving merchants little leeway to negotiate fees. Pennsylvania businesses are estimated to pay hundreds of millions of dollars annually in swipe fees, and these costs are often passed on to consumers through higher prices or covered by petite businesses themselves.
The legislation would prohibit swipe fees from being charged on the sales tax portion of a transaction. This will not affect purchases that are not subject to sales tax.
A broad coalition of business organizations supports it companion legislation of the House sponsored by state representatives Pat Gallagher, Steve SamuelsonAND Greg Scottincluding the Pennsylvania Food Merchants Association, Pennsylvania Retailers’ Association, Pennsylvania Restaurant & Lodging Association, Malt Beverage Distributors Association of Pennsylvania, Pennsylvania Petroleum Association, PA Tavern Association, Pennsylvania Distillers Guild and National Association of Convenience Stores.
Senator Pisciottano emphasized that this is a narrow, common-sense reform designed to support petite businesses, protect consumers and ease inflationary pressures by keeping more money in local communities.
“This legislation will help lower costs for Pennsylvania businesses and consumers,” added Senator Pisciottano. “At a time when families and small businesses are feeling the pressure of rising costs, we should not allow credit card companies to profit from Pennsylvania’s sales tax.”
Senator Pisciottano encourages his colleagues to join him in supporting efforts to lower costs for petite businesses and consumers.
The post Pisciottano’s Plan Aims at Hidden Swipe Fees to Lower Costs for Pennsylvania Businesses and Consumers appeared first on Pennsylvania Senate Democrats.
