AB-1065 • 2026

Credit card transaction fees: tax payments: Consumer Inflation Reduction and Tax Fairness Act.

Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: Ortega
Last action: 2026-02-02
Official status: From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
Effective date: Not listed

Plain English Breakdown

The bill summary does not provide specific details on enforcement mechanisms beyond referencing existing unfair competition laws, leaving some uncertainty about exact penalties for violations.

Reducing Credit Card Fees on Taxes

The Consumer Inflation Reduction and Tax Fairness Act requires that credit card transaction fees do not include certain state and local taxes and fees.

What This Bill Does

Requires the calculation of interchange fees charged by an issuer, a payment card network, an acquirer bank, or a processor to exclude certain state and local taxes and fees.
Defines terms related to credit card transactions for these purposes.
Prohibits payment card networks from altering the computation of interchange fees in ways that circumvent the act's requirements.

Who It Names or Affects

Credit card companies, including issuers, payment card networks, acquirer banks, and processors.
Consumers who pay taxes using credit cards.

Terms To Know

Interchange fees: Fees charged by a bank or financial institution when a customer uses their credit card to make a purchase.
Payment card network: A company that connects merchants and banks, allowing them to process credit card transactions.

Limits and Unknowns

The bill does not specify the exact penalties for breaking these rules.
It is unclear how this will affect different types of taxes or fees.

Bill History

2026-02-02 California Legislative Information
From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
2026-01-31 California Legislative Information
Died pursuant to Art. IV, Sec. 10(c) of the Constitution.
2025-04-22 California Legislative Information
Re-referred to Com. on B. & F.
2025-04-21 California Legislative Information
From committee chair, with author's amendments: Amend, and re-refer to Com. on B. & F. Read second time and amended.
2025-04-21 California Legislative Information
In committee: Set, first hearing. Failed passage. Reconsideration granted.
2025-04-10 California Legislative Information
Re-referred to Com. on B. & F.
2025-04-09 California Legislative Information
Read second time and amended.
2025-04-08 California Legislative Information
From committee: Amend, and do pass as amended and re-refer to Com. on B. & F. (Ayes 7. Noes 3.) (April 8).
2025-04-03 California Legislative Information
Re-referred to Com. on JUD.
2025-04-02 California Legislative Information
From committee chair, with author's amendments: Amend, and re-refer to Com. on JUD. Read second time and amended.
2025-03-13 California Legislative Information
Re-referred to Coms. on JUD. and B.&F. pursuant to Assembly Rule 96.
2025-03-10 California Legislative Information
Referred to Coms. on B.&F. and JUD.
2025-02-21 California Legislative Information
From printer. May be heard in committee March 23.
2025-02-20 California Legislative Information
Read first time. To print.

Official Summary Text

AB 1065, as amended, Ortega.
Credit card transaction fees: tax payments: Consumer Inflation Reduction and Tax Fairness Act.
Existing law, the Financial Code, provides for the licensure and regulation of various types of financial institutions and transactions. Existing law, the Song-Beverly Credit Card Act of 1971, regulates the issuance, use, and processing of credit cards and credit card transactions.
This bill would enact the Consumer Inflation Reduction and Tax Fairness Act, within the Financial Code, to require that the calculation of interchange fees charged by an issuer, a payment card network, an acquirer bank, or a processor not take into account certain state and local taxes and fees, as specified. The bill would define various terms for these purposes. The bill would prohibit a payment card network, an acquirer bank, or a processor from altering the computation of interchange fees, either by increasing the rate
or the amount of fees applicable, to circumvent the effects of the act.
Existing law, the Unfair Competition Law, makes various practices unlawful and provides that a person who engages, has engaged, or proposes to engage in unfair competition is liable for a civil penalty, as specified.
This bill would provide a violation of its provisions is enforceable pursuant to the Unfair Competition Law, as provided.

Current Bill Text

Read the full stored bill text

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