NASHVILLE, Tenn. — A recent federal court ruling in Illinois is drawing attention from retailers and lawmakers in Tennessee, where similar legislation aimed at limiting credit card swipe fees has been under consideration for several years. The Tennessee Grocers & Convenience Store Association (TGCSA) on Monday applauded last week’s ruling by the U.S. District Court for the Northern District of Illinois, Eastern Division, which upheld that state’s Interchange Fee Prohibition Act. Modeled on legislation first introduced in Tennessee in 2020, the Illinois law prohibits payment card companies from charging swipe fees on the sales tax portion of credit card transactions.
TGCSA President & CEO Rob Ikard issued the following statement: “Opponents of Tennessee’s Swipe Fee Fairness movement have tried to block our proposal by raising straw-man arguments about constitutionality and implementation. Now a federal court has confirmed that states can indeed regulate payment card companies. We hope Illinois implements this law on schedule, forcing card company compliance and putting to rest any objections about workability.”
Tennessee retailers collect state and local sales taxes at the point of sale. When customers pay with credit or debit cards, payment card companies assess an interchange — or “swipe” fee — calculated as a percentage of the total transaction, including the taxes collected on behalf of the state. Roughly 80% of retail sales are made using payment cards…