CHANDLER (Feb. 24, 2025) – In an op-ed for Chandler Independent, Arizona State Representative Jeff Weninger (LD 13) calls on the Legislature to pass HB 2629, which would shield Arizona small businesses from costly swipe fees (also known as interchange fees) when they are required to collect taxes on behalf of state and local governments.

In the op-ed, Weninger outlines how merchants cannot negotiate these fees, and ultimately, out-of-state companies make millions off the top of Arizona’s sales taxes.

“But here’s the kicker: the fees aren’t just charged on the cost of goods and services — they’re also tacked onto the sales tax businesses must collect and remit to the state. That means credit card companies are making billions of dollars from the taxes that consumers pay — money that was never theirs to begin with. […]

“HB2629 will stop this practice and ensure Arizona businesses and consumers are treated fairly. By eliminating swipe fees on sales taxes, we can keep more money in our state’s economy, help small businesses grow, and prevent credit card companies from profiting off of money that should go back to our communities.”

CLICK HERE to read the full op-ed. Excerpts are below:

It’s Time to End the Hidden Tax on Arizona Businesses

Chandler Independent
By: Arizona State Rep. Jeff Weninger (LD 13)
February 18, 2025

Every time you swipe your credit or debit card at a local business, there’s an extra, hidden cost—one that goes straight into the pockets of big banks and credit card companies. This hidden fee is unfair, unnecessary, and costing Arizona businesses millions of dollars. It’s time to put an end to it. […]

These fees, also known as interchange fees, are charged by credit card companies on every transaction. They can range from 1% to 5% per transaction, and businesses have no ability to negotiate them.

But here’s the kicker: the fees aren’t just charged on the cost of goods and services — they’re also tacked onto the sales tax businesses must collect and remit to the state.

That means credit card companies are making billions of dollars from the taxes that consumers pay — money that was never theirs to begin with. […]

That’s why I’m sponsoring HB2629, a bill that will ensure credit and debit card companies can only charge swipe fees on the pre-tax amount of a transaction, not the total price including sales tax.

Let’s break this down:

• U.S. retailers pay an estimated $160 billion annually in swipe fees.
• The average American consumer shoulders an extra $1,100 per year due to these costs being passed on to them. […]
• In 2023 alone, Arizona businesses paid over $217 million in swipe fees on sales taxes—a fee on a fee that never should have existed in the first place.

The credit card industry is dominated by two major players—Visa and Mastercard—who control 90% of payment processing transactions outside of China. […]

HB2629 will stop this practice and ensure Arizona businesses and consumers are treated fairly. By eliminating swipe fees on sales taxes, we can keep more money in our state’s economy, help small businesses grow, and prevent credit card companies from profiting off of money that should go back to our communities. […]

I urge my fellow lawmakers to support HB2629 and put an end to this hidden tax on Arizona businesses. Learn more at wipetheswipe.com.

Jeff Weninger is a small business owner and Republican member of the Arizona House of Representatives serving Legislative District 13. He also serves as Chairman of the House Commerce Committee.