PORTLAND, Maine —
QUESTION
Can businesses in Maine charge extra fees when customers pay with a credit or debit card?
THE SOURCES
THE ANSWER
No, businesses in Maine cannot charge extra fees when customers pay with credit or debit cards.
WHAT WE FOUND
According to card processor Visa, credit and debit card surcharges are illegal in four states: Maine, Massachusetts, Connecticut, and Oklahoma.
Maine's legislation explicitly states, "a seller in a sales transaction may not impose a surcharge on a cardholder who elects to use a credit card or debit card in lieu of payment by cash, check, or similar means."
"The retailers have a prohibition in Maine," Curtis Picard, president and CEO of the Retail Association of Maine, said.
This prohibition applies to retail businesses and restaurants that operate within the state.
However, it's essential to note the prohibition does not extend to government and state agencies.
"The state of Maine gave themselves permission to allow a surcharge, so when you go to your town office to pay your property tax or car registration, when you're paying with your credit or debit card, they are allowed to have a surcharge," Picard said. "The same goes for the university system: If you can charge tuition to a frequent flier mile credit card, the university is allowed to surcharge."
Each swipe of a credit card incurs a 3 percent cost to retailers for each transaction.
The law allows retailers to offer discounts for cash payments, but any such discount must be prominently posted for all customers to see, similar to signage at a gas station.
"A business still has to eat that swipe fee for processing, so the state of Maine still gets 5 percent for sales tax. We are not allowed to deduct the 3 percent cost of credit card payments on that, and the same goes for tips. One hundred percent go to servers, as it should be, but in reality the restaurant may be eating 3 percent of that through credit card charges," Picard said.
If you believe a business is unlawfully charging you a fee, you can file a report with the Maine Attorney General's Office by filling out a form online or by calling their office.
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