TN HB0967

Prohibits credit card interchange fees from being charged on the tax portion of electronic payment transactions, requiring payment card networks to exclude state and local taxes from the amount used to calculate swipe fees

Applies to sales and use taxes, hotel occupancy taxes, alcoholic beverage taxes, and rental vehicle surcharge taxes listed separately on invoices

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

Imposes a civil penalty of up to $1,000 per violation on payment card networks that fail to comply, plus mandatory refund of overcharged fees to affected merchants

Takes effect July 1, 2025