Senate · Introduced · 2025-2026 Regular Session

SB 512: "Consumer Inflation Reduction and Tax Fairness Act"; enact

Last action February 17, 2026 · Senate Read and Referred

A Georgia Senate bill would stop payment card networks like Visa and Mastercard from charging interchange fees on the sales tax portion of credit and debit card purchases, requiring refunds or fee exclusions for taxes.

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The summaries below were written by an AI model (claude-sonnet-5) from the text of the bill and are not part of it. Quote the text, not the summary. The stored text is the Introduced version, the latest the General Assembly's website lists.

In plain language

When a customer pays with a credit or debit card, the retailer pays a fee to the payment card network, often calculated as a percentage of the entire transaction, including sales tax. This bill, called the Consumer Inflation Reduction and Tax Fairness Act, would change that by amending Georgia's Fair Business Practices Act (O.C.G.A. Part 2 of Article 15 of Chapter 1 of Title 10) to bar interchange fees on the tax portion of a sale. Payment card networks would have to either exclude taxes from the fee calculation at the time of sale or refund the tax-related portion of the fee to retailers at least quarterly. If a retailer cannot provide tax information at checkout, the network can still charge on the full amount but must refund the tax-related fees once it gets proof of the taxes collected. Networks that willfully violate the law face a civil penalty equal to the tax-related fees charged in a year plus 10 percent. The bill also bans manipulating fees to get around these rules.

What the bill does

Bars payment card networks from charging interchange fees based on any amount above the actual price of goods or services, excluding taxes.
Requires payment card networks to either exclude taxes from interchange fee calculations or refund the tax-related portion of fees at least once per quarter.
Allows networks to delay refunds for retailers who cannot capture tax data at checkout, but requires refunds once proof of taxes collected is provided.
Imposes a civil penalty on networks that willfully violate the law, equal to the tax-related fees charged in a calendar year plus 10 percent.
Makes it illegal to raise interchange fee rates or otherwise manipulate fees in order to get around the new tax exclusion requirement.
Creates definitions for terms like 'interchange fee,' 'payment card network,' 'retailer,' and 'taxes' to clarify how the law applies.

Who it affects

Retailers of all kinds operating physical or online locations in Georgia, payment card networks such as Visa and Mastercard, payment card issuers (typically banks), and indirectly consumers who pay with credit or debit cards for purchases that include state and local sales, use, or excise taxes.

Why it matters

Retailers currently pay interchange fees calculated on the full transaction amount, including sales tax, which some argue inflates costs. If enacted, retailers would keep more money on card transactions since fees would no longer apply to the tax portion, potentially affecting pricing decisions and the cost of accepting card payments in Georgia.

Key provisions

Section 1 names the law the 'Consumer Inflation Reduction and Tax Fairness Act.'
Section 2 adds new Code Section 10-1-393.22 defining key terms including 'interchange fee,' 'payment card network,' 'retailer,' and 'taxes.'
Subsection (b) prohibits payment card networks from basing interchange fees on any amount greater than the actual goods and services price, excluding taxes.
Subsection (c) requires networks to exclude taxes from fee calculations or refund the tax-related fee amount at least quarterly.
Subsection (d) addresses cases where retailers cannot provide tax data at the time of sale, requiring refunds later once proof is submitted.
Subsection (e) sets a civil penalty for willful violations equal to the tax-related fees charged in a year plus 10 percent.
Subsection (f) bans altering or manipulating interchange fees to circumvent the law's effect.
Section 3 repeals any conflicting laws.

From the bill

“No payment card network shall apply an interchange fee to a retailer based on an amount greater than the goods and services consumer purchase price.”
This is the bill's core rule limiting how interchange fees can be calculated.

“A payment card network that willfully violates this Code section shall be subject to a civil penalty in an amount equal to any interchange fees paid by the retailer on the taxes for the goods or services provided by such retailer in a calendar year plus 10 percent.”
This sets the financial penalty for payment networks that willfully break the law.

“It shall be unlawful to alter or manipulate an interchange fee: (1) By increasing the interchange fee rate that is imposed upon the portion of a credit or debit card transaction”
This bans networks from raising fee rates elsewhere to make up for the lost tax-based fees.

Discussed in meetings (2)

The House and Senate meetings that took this bill up, from their machine transcripts. Each account was written by Georgia Commons with AI and is not part of the record; the video is what was said.

Senate Finance Committee, March 5, 2026
From 0:44:36 · Watch on the General Assembly's Vimeo channel
Summary by Georgia Commons: The sponsor said the bill would prohibit card-processing fees on state and local sales and excise taxes. Card companies could exclude taxes from fee calculations or refund those fees at least quarterly. The sponsor described a penalty of improperly charged fees plus 10% and a ban on rate increases intended to evade the restriction. The sponsor argued retailers should not pay fees on taxes they must collect. A RaceTrac witness said retailers cannot negotiate network-set rates and that technology already separates taxes for some commercial cards. One member suggested disclosing fees on receipts. Other members questioned why banks should absorb retailers' costs and suggested higher state compensation or customer prices instead. Opposing witnesses from the Electronic Transactions Association, banking groups and the Georgia Credit Union Association cited differing local tax rates, implementation costs and funding for fraud protection, credit and payment services. Banking witnesses favored increased retailer compensation, and one urged waiting for litigation over Illinois legislation. The RaceTrac witness disputed that banks bear all fraud losses, describing funds being removed from merchants during disputes. A Georgia Retailers witness said 2024 fees on Georgia sales taxes totaled $325 million, compared with $103 million in state vendor compensation. No vote was taken; the chair said examination would continue.

Read aloud: Senate floor session, February 17, 2026 (legislative day 19), 0:31:21

Status timeline

2026-02-17Senate Read and Referred (Senate)
2026-02-12Senate Hopper (Senate)

Topics

interchange fees
credit card fees
sales tax
consumer protection
retail regulation

Ask about this bill

Machine-readable https://georgiacommons.org/bills/2025-2026/sb512.md · https://georgiacommons.org/bills/index.md · MCP https://mcp.georgiacommons.org/mcp