SENATE, No. 1631

STATE OF NEW JERSEY

214th LEGISLATURE

 

INTRODUCED MARCH 4, 2010

 


 

Sponsored by:

Senator  JEFF VAN DREW

District 1 (Cape May, Atlantic and Cumberland)

 

 

 

 

SYNOPSIS

     Prohibits financial institutions from charging any fee on sales and use tax portion of retail sales transaction.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning credit card fees and supplementing Title 17 of the Revised Statutes.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    As used in this act:

     “Credit card” means any instrument or device, whether known as a credit card, credit plate, or by any other name, issued with or without fee by an issuing bank for the use of the credit card holder in obtaining money, goods, services or anything else of value on credit. 

     “Debit card” means any instrument or device, whether known as a debit card, automated teller machine card, or by any other name, issued with or without fee by an issuing bank for the use of the cardholder in obtaining money, goods, services or anything else of value through the electronic authorization of a financial institution to debit the cardholder's account.

     “Interchange fee” means the fee that a merchant’s financial institution pays to an issuing bank when a cardholder uses a credit card or debit card as payment during a retail transaction.

     “Issuing bank” means the business organization or financial institution that issues a credit card or debit card, or its duly authorized agent.

     “Merchant” means a person or entity doing business in this State which accepts credit cards or debit cards for the purchase of goods or services for sale in this State.

 

     2.    Discount rates, transaction charges, interchange fees, or any other charges or fees charged to a merchant or deducted from credit card or debit card sales by an issuing bank for processing credit card or debit card transactions of that merchant may be based on the dollar amount of the credit or debit card sale but shall exclude any sales and use tax portion of credit or debit card sales.

 

     3.    Any person violating the provisions of this act shall be subject to a civil penalty of up to $5,000.  Any civil penalty imposed may be collected with costs in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.) by the Attorney General or the functional regulator with jurisdiction over regulation of the financial institution.

 

     4.    This act shall take effect on the 365th day next following enactment.


STATEMENT

 

     This bill prohibits a financial institutional that issues a credit card or debit card from charging any fee based on the sales and use tax portion of a retail sales transaction.

     A person who violates the provisions of the bill is subject to a civil penalty of up to $5,000. Any civil penalty imposed may be collected with costs in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.) by the Attorney General or the functional regulator with jurisdiction over regulation of the financial institution.