Texas Credit Card Surcharge Law
Texas credit card surcharge law allows surcharging statewide. The old state ban was blocked in federal court in 2018 and is not enforced. Card network caps set the ceiling, and clear disclosure keeps you inside the rules.
Texas Allows Credit Card Surcharging
A ban sits in the state's commerce code. It has had no teeth since 2018.
Texas Business and Commerce Code Section 604A.0021 is a state law banning credit card surcharges. It is still printed in the state code today, but it cannot be enforced. In Rowell v. Paxton, a federal court in Austin blocked the state from enforcing it: telling customers about a surcharge is speech, and the First Amendment protects a merchant's right to communicate its pricing that way. The protection covers merchants who clearly disclose the surcharge. The state did not appeal. Nothing has been enforced against a disclosing merchant since.
The practical result for a Texas dealership is straightforward: surcharging is open with clear disclosure.
| Question | Answer |
|---|---|
| Status | Allowed |
| Cap | Card network caps |
| State statute | Business and Commerce Code 604A.0021, on the books but blocked by a federal court |
| Disclosure | Clear posting at entry and point of sale, itemized on the receipt |
Texas is one of 47 states where surcharging is legal. See the full table at credit card surcharge laws by state.
The Card Networks Set the Ceiling
With no enforceable state cap, Visa and Mastercard's own rules do the work.
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Visa: 3% Cap
In force nationwide since April 2023. Texas has no lower state ceiling.
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Mastercard: 4% Cap
Same network standard as Visa applies, just a higher ceiling.
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Debit Never Surcharges
Debit, prepaid, and gift cards can never carry a surcharge, in Texas 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 Blocked Ban Does Not Mean No Ceiling
The blocked state ban is not an open field. Visa's 3 percent and Mastercard's 4 percent still apply to every Texas dealership, and they are the only numbers a dealership needs to run against today. A standard 3 percent credit card surcharge sits inside Visa's cap.
No Debit Surcharge Is Texas State Law
In Texas, this is not just a network rule. It is written into the state code.
A separate statute, Texas Business and Commerce Code Section 604A.002, bans surcharges on debit and stored value cards. Unlike the credit card ban next to it, this one was never challenged in court. It remains live, enforceable Texas law.
In most states, debit-no-surcharge is only a card network rule. In Texas it is also state law. Either way, the practical answer at your counter is the same: debit, prepaid, and gift cards never carry a surcharge on the program.
The Rule Follows the Card, Not the Button
Pressing Credit at the terminal does not change what the card is underneath. A debit card run as credit is still a debit card, and the surcharge still cannot apply.
What This Means at the Counter
The counter just needs three things right.
A standard 3% credit card surcharge sits inside Visa's cap and stays disclosed the same way every surcharging state requires: notice at the point of entry, notice again at the point of sale, and the surcharge itemized as its own line on the receipt. Debit never carries a surcharge, backed by both the network rule and Texas state law. We track the state, not your front desk.
Texas is home for us. We run the whole program out of Houston.
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 Texas Rules
Yes. A federal court blocked the state's old surcharge ban in 2018, and it has not been enforced against a disclosing merchant since. Disclose the surcharge clearly at the door, the counter, and on the receipt, and you are in the protected practice.
Yes. With no enforceable state cap, the card network ceilings govern: Visa caps credit card surcharges at 3 percent and Mastercard at 4 percent. A standard 3 percent surcharge sits inside both.
No. Texas Business and Commerce Code Section 604A.002 bans debit card surcharges as state law, on top of the card network rule that already bans it everywhere. Both apply in Texas, and neither has an exception.
No state disclosure statute is currently in force. The court protection and the card networks both require clear disclosure: notice at the point of entry, notice again at the point of sale, and the surcharge shown as its own line on the receipt.
It is still printed in the state code, but a federal court blocked its enforcement in 2018 and the state has not enforced it since. Clear disclosure keeps you inside the protected practice. For pricing and program questions beyond state law, see the FAQ page.
Straight Answers on Texas
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