Fair Swipe Act: What It Could Mean for Credit Card Fees and Small Businesses

By Robert Skinner | WBN News | May 1, 2025

Sponsored: Talk To An Expert To Reduce Your Rates: Click Here

For years, small businesses have struggled under the weight of credit card processing fees — costs that often feel arbitrary and impossible to control. But a new bill introduced in Washington, D.C. might be the start of a shift.

The Fair Swipe Act of 2025, currently under review by the D.C. Council, proposes that sales tax and gratuities be excluded from the total amount used to calculate swipe fees on credit card transactions.

Why it matters:
Swipe fees (also known as interchange fees) are typically around 1.5% to 3.5% of the total sale — but that total includes tax and tips. That means businesses are essentially paying a fee to process money they never keep. For restaurants, cafés, salons, and other tip-based businesses, that adds up quickly.

Real-world impact:
Let’s say you run a small bistro where a $100 bill includes $10 in tax and a $15 tip. Today, swipe fees are charged on the full $100 — not just the $75 you actually earned. Under the proposed legislation, fees would only apply to the $75.

Over thousands of transactions per year, the savings could amount to hundreds or even thousands of dollars.

Who’s behind the bill?
The legislation was introduced by Councilmember Kenyan McDuffie and has gained traction with small business advocacy groups. While it only applies to D.C. for now, the Act is being watched closely in other states and provinces as a model for reform.

What small business owners should know:

It’s not law yet: The bill is under review and could be amended or blocked. Still, its presence signals growing legislative interest in swipe fee reform.
You can advocate: If you support similar measures in your province or state, you can raise the issue with local chambers of commerce, small business associations, or municipal reps.
Review your statements: Check how much you're paying on taxes and tips. Some processors may already have settings to reduce that base — or charge flat fees.
Consider itemized receipts: Even without legislation, clearly breaking out tips and tax on digital receipts may help when negotiating processor terms.

The big picture:
Swipe fees have long been seen as an unavoidable cost of doing business. But that’s starting to change. Whether this act passes or not, small business owners now have an opportunity to push back — and potentially reshape how payment systems treat them.

WBN News - South Delta Edition

Robert Skinner - Publisher

Sponsored: Talk To An Expert To Reduce Your Rates: Click Here

#WBN News - South Delta #Robert Skinner - Publisher #Swipe Fees #Credit Card Processing #Small Business Advocacy #Fair Swipe Act #Merchant Services #Business Tips #Payment Processing Reform