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Industry experts say card networks don't carry itemized tax/tip data; technical fixes would be complex
Summary
Payments‑industry witnesses told the commission point‑of‑sale systems record tax/tip breakdowns but card networks typically transmit only a single amount and transaction ID, making state‑level carve‑outs technically complex and potentially costly to implement.
Several speakers explained a fundamental technical constraint: consumer card network transmissions generally carry only the total amount and authorization data, not invoice‑level tax or tip fields. Deb Peters of the Electronic Payments Coalition said the sales‑tax amount is stored at the merchant software level for state compliance but "does not travel through the card networks," and that there is "no switch to turn on" to make a consumer card carry additional enhanced data today.
Witnesses added that adding invoice-level tax data to network messages would require broad changes across issuers, networks and processors and could slow authorization speeds. Fintech and payments experts recommended alternatives that avoid reengineering the global payment rails—examples included state vendor‑compensation frameworks or adopting an x9 QR pay‑code standard to enable richer, but interoperable, data flows on existing hardware.
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