FOR IMMEDIATE RELEASE
Contact: J. Craig Shearman
(202) 257-3678 craig@shearmancommunications.com
WASHINGTON, May 6, 2026 — The Merchants Payments Coalition welcomed today’s passage of legislation that would ban credit and debit card swipe fees on sales tax in Colorado and called on Gov. Jared Polis to sign the measure into law as soon as possible.
“This is landmark legislation that will save Colorado small businesses and their customers millions of dollars each year and keep that money in the local economy rather than sending to off to out-of-state megabanks and global card networks,” MPC Executive Committee member and National Association of Convenience Stores General Counsel Doug Kantor said. “Legislators should be applauded for protecting Colorado consumers from some of the outrageous inflationary impacts of credit card swipe fees. There is no reason credit card companies should stomp on Colorado’s tax collectors by penalizing them with price-fixed swipe fees. Other states should take notice and give their consumers and small businesses a break from the unaffordable swipe fees that are driving up the prices of nearly everything we buy.”
The Colorado House today gave final passage to the Swipe Fee Fairness and Consumer Safeguards Act, which would ban swipe fees on the sales tax portion of transactions, and sent the measure to Polis for his signature. The state Senate passed the measure last week.
Swipe fees on sales tax currently cost Colorado merchants $217.5 million a year and ultimately mean higher prices for state residents.
The legislation would make Colorado the second state in the nation to limit swipe fees, following an Illinois ban on swipe fees on sales tax and workers’ tips passed in 2024 that is set to take effect July 1. Similar legislation has advanced in the Pennsylvania and Delaware legislatures this spring.
The Illinois law was challenged by banks shortly after it was passed, but the measure was upheld in February by a federal judge who rejected their claim that it was preempted by federal banking law. U.S. District Judge Virginia Kendall said the law is not preempted because swipe fees are set by Visa and Mastercard, which are not banks and therefore not subject to the National Bank Act. Banks have appealed the ruling to the 7th U.S. Circuit Court of Appeals.
The legal dispute took a new turn late last month when the federal Office of the Comptroller of the Currency said it had “determined” that the National Bank Act preempts such measures from applying to nationally chartered banks. The agency released two interim final rules set to take effect June 30, including one intended to block the Illinois law and another to block similar laws under consideration in other states.
While the OCC said national banks are exempt from state swipe fee regulation, the Colorado legislation regulates card networks such as Visa and Mastercard rather than banks, and the OCC has no jurisdiction over card networks. Sponsors of the bill took that approach because blocking card networks from applying swipe fees to sales tax will keep financial institutions from collecting the fees regardless of banking law.
“The structure of the Colorado legislation makes the OCC rules irrelevant,” Kantor said. “The OCC’s interpretation of federal banking law is wrong on law and policy. It’s time to stand up for Main Street and its consumers rather than giant credit card companies and Wall Street banks.”
Concern over swipe fees has reached from statehouses to Congress and the White House. Congress is considering the Credit Card Competition Act to address the fees, and President Donald Trump endorsed the CCCA in January, saying it is needed “to stop the out of control Swipe Fee ripoff.”
Credit and debit card swipe fees have increased 80% since the pandemic, reaching a record $198.25 billion last year, including $4.5 billion in Colorado alone. They are most merchants’ highest operating cost after labor and are too much to absorb, driving up prices by more than $1,200 a year for the average family.
Visa and Mastercard — which control 80% of the market — each centrally set the swipe fees charged by banks that issue cards under their brands, and also block transactions from being processed over other networks that could do the job with lower fees and better security. Under the CCCA, banks with at least $100 billion in assets would enable cards they issue to be processed over at least two unaffiliated networks — Visa or Mastercard plus a competitor like NYCE, Star or Shazam. The measure is expected to result in competition over fees, security and service that would save merchants and consumers $17 billion a year.
About MPC
The Merchants Payments Coalition represents retailers, supermarkets, convenience stores, gasoline stations, online merchants and others fighting for a more competitive and transparent card system that is fair to consumers and merchants. Follow MPC on Twitter, Facebook or LinkedIn for the latest on swipe fees.
