MS SB2742

Excludes state and local taxes and fees from the transaction amount on which interchange fees are calculated for electronic payment transactions, including sales taxes and hotel/restaurant taxes.

Requires payment card networks to either deduct excluded taxes from interchange fee calculations at settlement or promptly rebate the proportionate interchange fee amount to merchants.

Imposes a civil penalty of up to $1,000 per violation on payment card networks that fail to comply, with refunds required to affected merchants and sellers.

Prohibits payment card networks from increasing interchange fees on non-tax portions of transactions to circumvent or offset the effect of this act.

Effective July 1, 2022.