Illegal Charges On Credit Cards Upset Legislators

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The situation where businesses around the Territory are opting to pass on the cost for credit card transactions to customers was criticized by Opposition Member and Second District Representative Hon. Melvin Mitch Turnbull in the House of Assembly on 8 June.

Hon. Turnbull who was at the time debating the Consumer Protection Bill announced that although legislators flagged the practice in 2016, some unscrupulous business owners are continuing to skirt credit card fees by forcing customers to pay.

“We know in every jurisdiction and every Territory there are those who have and those who would try to contravene the law…Who would try to break the law and get over…Mister Speaker. I remember in this Honourable House either 2015 or 2016…When the issue had come up where the bank was charging either three, or four or five percent…for the use of a credit card to the supplier and then the supplier was transferring that cost on each transaction. So every time you would swipe your card, Mr. Speaker the supplier started to charge you as the consumer three, or four or five percent on each transaction,” the Opposition Member stated.

In complaining about the situation Hon. Turnbull reminded us that there is a law to combat such illegal practice: “Mister Speaker we sat in this House and we passed legislation 2016. We passed legislation that stated that cost is the cost for the supplier. That’s a cost for you doing business in the Territory, doing business with the banks. It should not be passed on to the consumer. There was a lot of back and forth there was a lot of conversation, but I must confess to you two things – still today there are those businesses carrying on those practices. Whenever it happens to me or it is attempted to happen to me I speak up on it, and I let them know I am not paying what you are supposed to be paying. That is a cost that you are supposed to be paying as the business owner.”

The Opposition Member said that the Consumer Protection Bill will enable the investigation of such practices. He said that the legislation will also have teeth to deal with such occurrences.

As was mentioned by Hon. Turnbull this very situation was raised in the House of Assembly during the 22 March 2016 sitting. At the time the matter was raised by the current Leader of the Opposition Hon. Marlon Penn. When he commented Hon. Penn was speaking in the capacity of the Junior Minister of Trade and Investment.

While Hon. Penn did not identify the guilty business, he did mention that it was an establishment that was operating in the Third District; and he referred to the practice as a form of illegal taxation. He told the House: “It is a business within the Third District — it was brought to my attention that this business charges a five percent surcharge on all the customers who do business with the use of a credit card, or visa/master card.”

Hon. Penn explained that the businesses add the tax to avoid paying fees to credit card companies, by passing the cost on to customers. He further stated that the guilty businesses are charging the customers five percent instead of the two or three percent they are being charged and are even charging for debit transactions: “It goes even further — they even charge on debit cards, which is a direct debit to your account. This means, that the agency or the business does not get charged for processing that transaction on a debit transaction, but they are charging you five percent.”

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