As of early 2026, credit card surcharges are primarily prohibited or heavily restricted in Connecticut, Maine, Massachusetts, and Puerto Rico. While other states like California, New York, Texas, and Florida previously had bans, court rulings have made those prohibitions unenforceable or shifted them to strict disclosure regulations.
Eleven states—California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas—and Puerto Rico have laws that prohibit merchants from charging consumers with surcharges on credit card transactions.
Yes, except in some states with laws that prohibit credit card surcharges. Florida has a law prohibiting credit card surcharges, but that law was held unconstitutional by federal courts.
State-by-State Legality
As of June 2025 surcharges are prohibited or restricted in the following: California. Connecticut. Maine.
Use cash where you can
The easiest way to avoid card surcharges is to pay by cash. While businesses can charge a surcharge for paying by debit or credit cards, they can't charge a surcharge for paying by cash.
Under Texas Business and Commerce Code § 604A. 0021, imposing a surcharge on a buyer who uses a credit card instead of cash, check, or a similar payment method is unlawful.
The statute prohibits any seller from advertising or offering a product or service at one price and then adding a separate charge later. That includes credit card surcharges, regardless of whether they are a flat fee or a percentage-based upcharge.
The 15/3 credit card payment method is a strategy to potentially boost your credit score by making two payments per billing cycle: one about 15 days before your statement closes (to lower reported utilization) and another around 3 days before the payment due date (to cover the rest and avoid late fees), though its actual impact on credit scoring is debated. It works by keeping your reported balance lower when the card issuer reports to bureaus, but experts note the specific timing isn't magical, and focusing on the reporting date is key.
The new reality: what's changing. The RBA's comprehensive proposal aims to eliminate surcharges on EFTPOS, Mastercard, and Visa transactions from July 2026.
The 2/3/4 rule is a guideline, primarily used by Bank of America, that limits how many new credit cards you can get: no more than 2 in 30 days, 3 in 12 months, and 4 in 24 months, helping to prevent over-application and manage hard inquiries on your credit report. While not universal, it's a useful benchmark for responsible card application, though other banks have different rules (like Chase's 5/24 rule).
To avoid a credit card surcharge, you can pay with alternative methods such as cash, debit cards, or mobile payment apps. Some businesses also offer discounts for non-credit card payments, providing an incentive to choose other payment options that help avoid credit card surcharge.
A payment surcharge, also known as checkout fee, is an extra fee charged by a merchant when receiving a payment by cheque, credit card, charge card, debit card or an e-money account, but not cash, which at least covers the cost to the merchant of accepting that means of payment, such as the merchant service fee imposed ...
Maine's “No surcharge for credit or debit card payments” law prohibits sellers from adding extra charges (surcharges) to credit card or debit card transactions.
A "3-year law in Texas" typically refers to the standard full-time Juris Doctor (J.D.) program at Texas law schools like UT Austin, UNT Dallas, or University of Houston (UHLC), designed for dedicated study over three intensive years, contrasting with part-time options. It's the typical path to becoming a licensed lawyer, involving rigorous coursework, skills training, and culminates in a J.D. degree after completing ~90 credit hours, preparing graduates for various legal careers.
The borrower may not directly or indirectly pay more than 2% of the original base loan amount in fees and charges regardless of whether the fees and charges are paid in cash or financed or a combination thereof. The lender/broker may pay fees to the extent the actual fees exceed the 2% limitation.
Yes, it is generally illegal for U.S. merchants to charge an extra fee (surcharge) on debit card purchases, with major card networks prohibiting it, reinforced by federal law (Durbin Amendment) and various state laws, though some states have specific bans or restrictions, making it a complex area where merchants often illegally pass on costs as surcharges or convenience fees.
To meet our promise of high quality products at the most affordable prices, a 0.5% surcharge is included on all credit card and contactless card purchases at our stores. Customers who process payment by inserting their card and selecting savings will avoid this fee.
Debit card transactions are exempt from surcharging. Surcharges must be registered by the business.
Yes, charging a 3% credit card fee (surcharge) is generally legal in most U.S. states and follows card network rules (like Visa's 3% cap), but it depends heavily on your location and requires strict adherence to rules, such as not surcharging debit cards, capping it at your actual processing cost (not to exceed 3% for Visa/4% for Mastercard), and providing clear customer notification. Some states (like Connecticut, Massachusetts, Texas) may have their own bans or restrictions, so it's crucial to check your specific state laws.
The 30/30/30/10 rule for restaurants is a budget guideline allocating revenue: 30% for food costs, 30% for labor, 30% for overhead, and the final 10% for profit. It helps operators manage expenses and maintain profitability, though achieving these targets can be challenging due to rising costs and evolving customer demands, with many restaurants currently falling short, averaging lower profits.
Businesses are charging credit card fees (surcharges) primarily to offset the rising costs of processing card payments, which include fees from card networks (Visa, Mastercard) and banks, allowing them to protect thin profit margins, offer lower prices for cash/debit users, and stay competitive without raising prices for everyone. These fees have increased as more consumers use credit cards, making these processing costs a significant business expense, sometimes even third behind payroll and rent, pushing merchants to pass these costs directly to card-using customers.