Substitute House Bill No. 5489 (File No. 541) aims to adjust how interchange fees are calculated on electronic payment transactions by excluding sales tax from the fee calculation. Interchange fees are charged by financial institutions to retailers for processing card transactions. The bill mandates that payment card networks must either subtract the sales tax amount from the interchange fee at the time of settlement or provide a rebate for the fee portion related to the sales tax. This is contingent on the retailer's ability to capture and transmit the sales tax amount at the time of sale. If the retailer cannot provide this information at the point of sale, they are permitted to submit sales data later to show the collected sales tax on transactions with interchange fees, which the payment card network must then credit to the retailer's account.

Furthermore, the bill empowers the Attorney General to enforce these provisions by filing actions against payment card networks that do not comply, with potential civil penalties of up to $1,000 per violation and refunds to affected retailers. The bill is set to take effect on October 1, 2024, and will apply to sales from that date forward. It has passed through committee with a Joint Favorable Substitute from the Finance, Revenue and Bonding Committee, indicating legislative support. The fiscal impact statement notes that the bill does not affect the state's tax revenue. The summary does not include specific insertions or deletions to the current law as they were not provided in the text.