California has been identified as the most expensive state to start a new business, highlighting the pressing need for legislative changes to ease financial burdens on entrepreneurs. Assemblymember Liz Ortega's proposed bill, AB 1065, aims to eliminate interchange fees on sales taxes and tips, potentially providing over a billion dollars in savings for the state's four million small businesses. Current swipe fees significantly inflate costs for both businesses and consumers, with small U.S. businesses paying $148 billion last year alone. The consolidation of credit card giants Visa and Mastercard further exacerbates the issue.
The average American family pays an additional $1,200 annually due to costs associated with "swipe fees,” which burdens consumers while harming small businesses.
Assemblymember Liz Ortega's bill AB 1065 aims to cut interchange fees on sales taxes and tips, potentially saving California's small businesses over a billion dollars.
Swipe fees initially offset transaction processing costs but have soared over the years, costing U.S. small businesses $148 billion last year.
Visa and Mastercard dominate the credit card market, controlling eighty percent, allowing them to increase "swipe fees" with little resistance from small business owners.
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