New York Credit Card Surcharge Law
New York credit card surcharge law allows surcharging with limits: the surcharge can never exceed what card acceptance actually costs your dealership, and the total card price has to be posted up front before the customer pays. Get the cap wrong or the sign wrong and the state can fine you per violation.
New York Allows Credit Card Surcharging
The state banned surcharges for four decades. That ban is gone.
From 1984 until February 11, 2024, New York ran a flat ban on credit card surcharges under the original General Business Law Section 518. A group of merchants challenged it, and in Expressions Hair Design v. Schneiderman the U.S. Supreme Court held in 2017 that the ban regulates speech: telling a customer about a surcharge is a form of price communication, and the case was sent back for First Amendment review rather than settled outright. New York did not wait out the litigation. The legislature rewrote the statute, Governor Hochul signed it in December 2023, and the new version took effect February 11, 2024.
The rewrite replaced a flat ban with a cost cap plus a disclosure rule. There is no fixed percentage in the statute. The ceiling is what card acceptance actually costs your dealership, and the price posted at the counter has to be the price the customer pays.
| Question | Answer |
|---|---|
| Status | Allowed with limits |
| Cap | Your actual processing cost |
| State statute | General Business Law Section 518, amended effective February 11, 2024 |
| Disclosure | Post the total card price, or show cash and card prices side by side |
| Penalty | Civil penalty up to $500 per violation |
New York is one of 47 states where surcharging is legal. See the full table at credit card surcharge laws by state.
A Cost Ceiling, Not a Percentage
GBL 518 does not set a number. It sets a limit tied to what you actually pay.
The statute caps the surcharge at whatever the card company actually charges your dealership to process that transaction. That number moves by card brand, card type, and your own processing setup, and it is not written anywhere in the statute as a flat rate. The card networks still layer their own rules on top of the state cap, and both apply at once.
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Visa: 3% Cap
Or your actual cost of acceptance, whichever is lower.
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Mastercard: 4% Cap
Same actual cost logic as Visa, just a higher ceiling.
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Debit Never Surcharges
Debit, prepaid, and gift cards can never carry a surcharge, in New York or anywhere else.
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Disclosure Is Mandatory
Post notice at the door and the counter, and show the surcharge as its own line on the receipt.
A Cost Cap, Not a Percentage
GBL 518 never names a rate. The legal limit is the amount the card company charges your dealership for that transaction, full stop. A number that clears the Visa or Mastercard ceiling does not automatically clear the New York statute, because the New York statute is measured against your actual cost, not a network percentage. Your merchant statement, not a fixed rate, is what the cost cap points to.
The Price on the Sign Is the Price They Pay
The law gives you two ways to display it. Pick one and match it at checkout.
GBL 518 gives a dealership two compliant ways to show a credit card surcharge. The first: post the total credit card price, inclusive of the surcharge and excluding tax, so the number on the sign or the repair order is the number the customer sees on their statement. The second: two-tier pricing, a cash price and a credit price posted side by side, so the customer sees the cost of paying by card before they hand over the plastic. Either way, the amount actually charged at the counter can never run higher than the price that was posted. A business that gets this wrong is looking at a civil penalty up to $500 per violation, and each violation is counted separately.
Two Displays Work. Nothing Else Does.
Total card price posted, or cash and credit shown side by side. Either display satisfies GBL 518. What does not satisfy it: a posted number that does not match what runs at the terminal, or a surcharge the customer only learns about after the card is swiped.
What This Means at the Counter
Disclosure is where most of the work sits.
Disclosure runs at the point of entry, again at the point of sale, and a third time as its own line on the receipt. Debit never carries a surcharge, in New York or anywhere else, no exceptions and no workarounds. We track the state, not your front desk.
Payments post straight to the repair order in CDK Drive, so the surcharge line shows up where your advisors already work. See the full mechanics on the surcharge program page, or walk through exactly what happens at the terminal on the how it works page.
Straight Answers on New York Rules
Yes, since February 11, 2024. New York's General Business Law Section 518 used to run a flat ban on surcharges, but the legislature replaced it with a cost cap plus a disclosure requirement, signed into law in December 2023.
There is no fixed percentage in the New York statute. The legal cap is the amount the card company actually charges you to process that transaction. Visa's 3 percent ceiling and Mastercard's 4 percent ceiling still apply on top of that, both under the same lesser-of-actual-cost logic.
Post the total credit card price inclusive of the surcharge, or show a cash price and a credit price side by side. The amount charged at checkout can never exceed the price that was posted. A receipt line item still applies under card network rules.
No. Debit, prepaid, and gift cards can never carry a surcharge, in New York or any other state. That is a card network rule, not a state one, and it applies regardless of how the card runs at the terminal.
A civil penalty up to $500 per violation, with each instance counted separately. For pricing and program questions beyond state law, see the FAQ page.
Straight Answers on New York
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