Times Observer photo by Josh Cotton State Sen. Scott Hutchinson, right, speaks back in March at Warren-Forest Hi-Ed’s legislative breakfast at the Conewango Club.

State Sen. Scott Hutchinson has put forward legislation that would exempt sales tax from the “swipe” fees that businesses have to pay to process a credit card.

The change, he outlined in a legislative memo, “would calculate processing fees solely on the sales portion of a credit and debit card transaction.”

Currently, he outlined, “Pennsylvanians pay processing on ‘swipe’ fees on the total amount of a credit or debit card transaction – including any sales tax.”

That might sound pretty technical but Hutchinson’s memo outlines the change with a hypothetical.

“f you buy a bottle of shampoo at your local retailer and pay with your credit card, that business is obliged to pay a percentage fee to the credit card processor based not just on the price of the product, but the additional 6% sales tax as well,” he explained.

“Our local retailers should not be punished for collecting sales tax on behalf of the commonwealth,” Hutchinson argued. “Currently, multiple states across the nation are looking at and addressing this issue as it is states who have the authority to prohibit credit card processors from charging swipe fees on state sales tax.

“Exempting the sales and use tax from being subject to processing fees would keep dollars in Pennsylvania, helping our local businesses. This change would help keep money in the pockets of customers at a time when inflation is forcing every penny to go further, while allowing our businesses to continue to serve their communities and assist the state.”

Text of the bill had not been introduced as of Tuesday.