Credit Card Surcharges

In 1985, California passed a law that prohibits merchants from adding a surcharge (an extra fee) when customers pay by credit card instead of cash. That law does allow merchants to give customers discounts for paying by cash, check, or debit card, as long as that discount is offered to all customers. In March 2015, however, a federal court declared that law unconstitutional and prohibited the Office of the Attorney General from enforcing it. The Office believes that this decision is incorrect and is currently appealing that order. For now, though, the Office cannot enforce that specific law.

Merchants are not allowed to mislead customers, such as by falsely advertising a lower price than they actually charge. If a merchant fails to clearly and prominently disclose—before you pay for an item—what it will charge for the item (such as any additional fees), that may violate the law. Be sure to check the cash register display and your receipt to make sure that the price you’re being charged matches the advertised price of an item (plus tax, if applicable).

Credit card companies also have their own rules about how and when merchants may add surcharges on a purchase. If a merchant violates these rules, you may be able to file a complaint with the credit card company to recover the amount of the surcharge. Different credit card companies have different rules, so make sure you review the rules for the credit card you have (Visa, Mastercard, American Express, Discover, etc.).

If you believe a merchant is improperly charging customers, failing to disclose what it is charging, or is otherwise engaging in false or misleading sales practices, you may file a complaint with the Attorney General’s Office. The Office uses complaints to learn about misconduct. However, we cannot give legal advice or provide legal assistance to individuals.