| 88R23121 SRA-D | |||
| By: Capriglione | H.B. No. 3395 | ||
| Substitute the following for H.B. No. 3395: | |||
| By: Bhojani | C.S.H.B. No. 3395 | ||
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| relating to the charging of swipe fees on certain electronic | ||
| payment transactions; authorizing a civil penalty. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Title 12, Business & Commerce Code, is amended by | ||
| adding Chapter 610 to read as follows: | ||
| CHAPTER 610. CHARGING OF SWIPE FEES | ||
| Sec. 610.001. DEFINITIONS. In this chapter: | ||
| (1) "Assessment fee" means a fee, usually based on the | ||
| total amount of monthly sales, paid directly to the payment card | ||
| network for allowing a merchant to use a payment card or other | ||
| payment code or device in an electronic payment transaction. | ||
| (2) "Electronic payment transaction" means a | ||
| transaction in which a person uses a payment card or other payment | ||
| code or device issued or approved through a payment card network to | ||
| debit a deposit account or use a line of credit, whether | ||
| authorization is based on a signature, personal identification | ||
| number, or other means. | ||
| (3) "Interchange fee" means a fee charged to a | ||
| merchant for the purpose of compensating the payment card issuer | ||
| for the issuer's involvement in an electronic payment transaction. | ||
| (4) "Payment card" means a credit card, debit card, | ||
| check card, or other card that is issued to an authorized user to | ||
| purchase or obtain goods, services, money, or any other thing of | ||
| value. | ||
| (5) "Payment card issuer" means a lender, including a | ||
| financial institution, or a merchant that receives applications and | ||
| issues payment cards to individuals. | ||
| (6) "Payment card network" means an entity that | ||
| directly, or through a licensed member, processor, or agent, | ||
| provides the proprietary services, infrastructure, and software | ||
| that route information and data to conduct debit card or credit card | ||
| transaction authorization, clearance, and settlement, and that an | ||
| entity uses in order to accept as a form of payment a brand of debit | ||
| card, credit card, or other device that may be used to carry out | ||
| debit or credit transactions. | ||
| (7) "State or local tax" includes a tax imposed by this | ||
| state or a unit of local government of this state, including the | ||
| sales, excise, and use tax, motor fuels tax, hotel occupancy tax, | ||
| mixed beverage sales tax, and tax imposed on the rental of a motor | ||
| vehicle, other than a tax returned to a taxpayer in the form of a | ||
| deduction or discount under Section 151.423 or 151.424, Tax Code. | ||
| (8) "Swipe fee" means the interchange fee and, if | ||
| applicable, the assessment fee. | ||
| Sec. 610.002. APPLICABILITY. This chapter applies only to | ||
| electronic payment transactions conducted by a merchant that is a | ||
| small business as defined by the United States Small Business | ||
| Administration on September 1, 2023. | ||
| Sec. 610.003. EXCLUSION OF STATE OR LOCAL TAXES FROM SWIPE | ||
| FEES; MERCHANT DEDUCTION OR REBATE. (a) The amount of state or | ||
| local tax that is calculated as a percentage of the amount of an | ||
| electronic payment transaction and listed separately on a payment | ||
| invoice or other demand for payment must be excluded from the total | ||
| amount on which a swipe fee is charged for that transaction. | ||
| (b) A payment card network shall with respect to each form | ||
| or type of electronic payment transaction: | ||
| (1) deduct the amount of state or local tax imposed | ||
| from the calculation of swipe fees attributable to the transaction | ||
| at the time of settlement; or | ||
| (2) rebate the merchant an amount equal to the amount | ||
| of swipe fees attributable to the state or local tax imposed on the | ||
| transaction. | ||
| (c) A deduction or, subject to Subsection (d), a rebate | ||
| under this section must occur at the time of settlement when the Statutes affected: Introduced: () House Committee Report: () | ||