Senate passes bill to bar card networks from charging swipe fees on sales tax; debate centers on carve‑outs and enforcement

The Senate passed Senate Bill 134 on April 27 after an extended floor discussion that ranged from the mechanics of separating tax data in merchant systems to concerns about market disparity and enforcement. Sponsor Senator Lindstead said Colorado businesses paid more than $217 million in swipe fees on sales tax in 2024 and argued the state should stop permitting "financial institutions" to profit from tax dollars merchants are required to collect.

Co‑sponsor Senator Jonah told the chamber that card systems already transmit tax data using "type 2" data and that networks could comply by eliminating percentage fees on tax or shift to flat fees; he said the bill was narrowly targeted at large, out‑of‑state networks and exempted community banks and credit unions below the $60 billion asset threshold. The sponsors added an amendment (L29) to extend the effective date to Jan. 1, 2028, and an amendment (L31) requiring certain very large retail employers to apply savings toward lower prices or employee wages; the floor adopted L31 and a later amendment L33 clarified parent‑company measurement.

Opponents warned the measure could create arbitrary advantages among businesses and banks, spur litigation, and shift costs to consumers or to other transaction categories. Questions about enforceability—and whether the Department of Revenue or other agency would verify retailers’ compliance—led to several defeated motions to require audits or extra department duties.

The Senate adopted SB 134 and several amendments; the chamber recorded proponents and opponents in the floor debate and placed the bill on the calendar for subsequent enrollment steps.