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Illinois Imposes a Zero Credit Card Price Control on Sales Tax

Last year we helped ring the alarm on this hare-brained scheme when it was proposed in Florida.

Now a blue state, Illinois, has become the first to mandate an exclusion from credit card interchange fees for sales tax.

Governor Pritzker shoved it through the legislature over the Memorial Day weekend, with final passage early Wednesday morning.

To comply, restaurants and retailers will have to run your credit card twice — once for the total before tax and tip (also excluded under this bill), and then again for tax and tip, with no interchange charged on the second transaction.

This is a clumsier, even worse way to impose the same goal as other price control legislation, with the same likely adverse consequences of less fraud protection, erosion of rewards programs, less availability of credit for low-income customers, etc.

It’s going to be yet another huge inconvenience for the people of Illinois and anybody who still visits the once-great city of Chicago.

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