Conservatives and community banks across the political spectrum are sounding the alarm over an onerous payment processing bill worming its way through the Florida legislature.
Conservative organizations and Alex Sanchez, the president and CEO of the Florida Bankers Association, have voiced opposition to House Bill 677, or Senate Bill 564.
The legislation, in short, would ban interchange fees of the sales tax portion of electronic payment transactions in Florida. Opponents allege that the bill would lead to onerous mandates on small businesses and would serve as a boon to large retailers.
In an interview with Breitbart News, Sanchez said the bill “will create a burdensome unfunded mandate on Florida and small businesses. And, just to let you know how it works, showing small businesses simply process a transaction and move on to the next sale. If this bill passes small businesses will need to purchase new software that can separate tax and tip amounts from sales.”
Sanchez confirmed that the bill will primarily serve as a boon to large retailers.
“The bill will require banks to start collecting an unprecedented level of transaction-specific data which is an unwanted invasion of a customer’s privacy. And the big mega-retailers are doing this at the expense of small businesses and small community banks,” he added.
Home Depot has lobbied Florida House lawmakers in favor of the bill. It’s possible woke retailer Disney could also benefit.
The Florida community bank representative said that small and community banks often rely on the interchange to cover the risk of customer defaults.
He said, “When a customer defaults, we don’t ask the retailer for the purchase price back. We don’t ask the server for the tip back or the state of Florida for the tax back. We’re the ones who have to cover that. So you know, to have all these separate transactions is ludicrous to be the only state in the country to do this.”
Americans for Tax Reform (ATR), the American Consumer Institute, Independent Women’s Voice, James Madison Institute, National Taxpayers Union, Consumer Choice Center, Competitive Enterprise Institute, the Center for a Free Economy, American Commitment, and Less Government wrote a letter to members of the Florida House Commerce Committee lawmakers in March, urging them to reject the controversial bill.
The conservative groups argued that the bill would create onerous new requirements for businesses, which would only harm Floridians:
Under SB 564 (HB 677), the government would insert itself into this functioning system and try to make one party bear the full burden of the tax the government has created by preventing payment processors from applying the usual interchange fee to the full amount of a transaction.
Like every government attempt to control the market, there will be unintended consequences. By drastically increasing the amount of transactions processed, forcing processors to create new systems, software, and even new equipment, costs for small businesses and consumers in Florida would rise. These added costs will be placed on the processing system, merchants will pass them down to consumers, and everyone will lose.
This is unjustified government interference in the market. If the sales tax burden is too high, and transaction costs are hurting Florida businesses, legislators can reduce the sales tax, or increase sales tax collection allowance.
Sanchez asked rhetorically why Florida legislators would move to pass this legislation in the “Free State of Florida.”
Sean Moran is a policy reporter for Breitbart News. Follow him on Twitter @SeanMoran3.
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