Washington Credit Card Surcharge Laws

Quick Summary:

• Credit card surcharging is legal in Washington state with no state-specific restrictions
• Businesses follow federal guidelines limiting surcharges to 4% maximum
• Washington enforces surcharge violations through the Consumer Protection Act (RCW 19.86)
• Penalties include civil fines up to $7,500 per violation and potential treble damages
• Debit card surcharges remain prohibited under federal law

Washington state takes a hands-off approach to credit card surcharging, imposing no additional restrictions beyond federal regulations and card network requirements. This regulatory simplicity creates a business-friendly environment where contractors, wholesale distributors, and accountants can implement processing fee recovery programs without navigating complex state-specific requirements.

The state's focus remains on preventing deceptive business practices rather than restricting specific fee structures. Washington's robust Consumer Protection Act provides a comprehensive framework for addressing misleading surcharge practices while allowing legitimate businesses to recover processing costs transparently.

Legal Disclaimer: This information is for reference only and does not constitute legal advice. Business practices and regulations can change. Consult with an attorney before implementing surcharge programs.

Is Credit Card Surcharging Legal in Washington?

Yes, credit card surcharging is legal in Washington state. The state has not enacted any laws prohibiting or restricting surcharges beyond federal requirements, giving businesses maximum flexibility in implementing credit card fees.

Washington's permissive approach means businesses can add surcharges up to federal limits (4% maximum) and card network restrictions (typically 3% for Visa) without worrying about state-specific caps, disclosure requirements, or registration processes.

This regulatory simplicity reflects Washington's general business-friendly philosophy while maintaining strong consumer protections through the Washington Consumer Protection Act (RCW 19.86), which addresses deceptive practices across all business activities.

What's Allowed

Washington businesses can implement these surcharge practices:

• Credit card surcharges up to federal and card network limits (typically 3-4%)
• Percentage or flat fee structures based on business needs
• Multiple payment method pricing with different rates for various payment types
• Cash discount programs as alternatives to surcharging
• Flexible disclosure methods that meet card network requirements without additional state mandates

Washington's approach allows businesses to choose surcharge structures that work best for their operations while following standard federal compliance requirements.

What's Not Allowed

Washington prohibits these practices under its consumer protection framework:

• Debit card surcharges - prohibited under federal law for all debit and prepaid cards
• Misleading or deceptive practices regarding surcharge disclosure or purpose
• Excessive surcharges that substantially exceed actual processing costs
• Unfair business practices that violate Washington's general consumer protection standards

While Washington doesn't have surcharge-specific prohibitions, businesses must avoid practices that would constitute unfair or deceptive acts under the state's broader consumer protection laws.

Penalty For Non-Compliance

Washington enforces surcharge-related violations through its comprehensive Consumer Protection Act rather than specific surcharge penalties. RCW 19.86.140 establishes significant penalties for unfair or deceptive business practices:

Civil Penalties:

• Up to $7,500 per violation for businesses that engage in unfair or deceptive practices
• Enhanced penalties for violations targeting specific demographic groups
• Treble damages (up to 3x actual damages, capped at $25,000) available to injured consumers
• Attorney fees and costs recoverable by successful plaintiffs

Enforcement Authority:

• Washington Attorney General's Consumer Protection Division can investigate deceptive surcharge practices
• Civil lawsuits by the Attorney General on behalf of the state
• Private consumer actions under RCW 19.86.090 for damages and injunctive relief
• Restitution orders to restore consumer losses

Consumers can file complaints with Washington's Consumer Resource Center online or by calling their consumer hotline to report businesses that engage in misleading surcharge practices.

Types of Businesses That Must Follow Washington's Surcharge Laws

Washington's Consumer Protection Act applies broadly to all businesses engaged in trade or commerce within the state. This includes:

• Contractors and construction companies processing large project payments
• Wholesale distributors handling supplier and customer transactions
• Professional service providers including accountants, consultants, and attorneys
• Retail businesses accepting customer credit cards
• Online merchants selling to Washington residents
• Healthcare providers processing patient payments
• Restaurants and hospitality businesses
• Government contractors and public-private partnerships

Washington's broad application ensures consistent treatment across industries while maintaining flexibility for businesses to structure fees appropriately for their specific operational needs.

Is Debit Card Surcharging Legal in Washington?

No, debit card surcharging is illegal in Washington. This prohibition applies nationwide under the Durbin Amendment to the Dodd-Frank Act, which prohibits surcharges on all debit card transactions regardless of how they're processed.

Washington businesses can offer cash discounts or implement dual pricing structures, but cannot add specific fees to debit card transactions. This federal restriction overrides Washington's otherwise permissive approach to payment processing fees.

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Washington Credit Card Surcharge FAQs

Does Washington require special notifications or registrations for credit card surcharges?

No, Washington has no state-specific requirements beyond what card networks mandate. Businesses must follow Visa, Mastercard, and other network rules for customer notification, but don't need to register with state agencies or comply with additional disclosure requirements.

Can Washington contractors and distributors use surcharges for large B2B payments?

Yes, Washington's lack of state restrictions gives B2B companies full flexibility in surcharge implementation. Many contractors and distributors processing large invoice-based payments use percentage-based surcharges (typically 2.5-3%) that align with their actual processing costs.

How does Washington's Consumer Protection Act apply to surcharge practices?

The Act prohibits "unfair or deceptive acts or practices" in trade or commerce. Surcharges become problematic if they're misleadingly disclosed, exceed actual processing costs by substantial amounts, or are described inaccurately to customers.

What should Washington businesses know about multi-state surcharge compliance?

While Washington maintains permissive surcharge laws, businesses operating across state lines must comply with the most restrictive state's requirements. Companies serving customers in states like Connecticut or Massachusetts may need different approaches for different markets.

How does Washington's Consumer Resource Center handle surcharge complaints?

Washington uses an informal complaint resolution process where the Consumer Resource Center contacts businesses about consumer complaints and facilitates communication to resolve disputes. This approach emphasizes problem-solving over punitive enforcement for reasonable business practices.

Can Washington bookkeepers and accountants add surcharges to client payments?

Yes, accounting professionals can implement surcharges on client payments without state-specific restrictions. Many use this approach to maintain service margins while offering clients flexible payment options, provided they follow standard card network disclosure requirements.

What enforcement priorities does Washington's Attorney General have for consumer protection violations?

Washington's Consumer Protection Division focuses on patterns of deceptive conduct that harm the public rather than isolated violations. The office processed over 25,000 consumer complaints annually and helped return more than $4 million to consumers through informal resolution.