What happened
Colorado Governor Jared Polis vetoed Senate Bill 26-134 on Wednesday, preventing a state law from taking effect that would have prohibited interchange fees on the tax portion of credit card transactions. The bill, titled "Payment Card Networks' Fees," aimed to exempt tax (and potentially tip) from interchange calculations. Polis cited legal risks to the business environment and limited upside for small businesses as reasons for the veto. The decision aligns with ongoing uncertainty at the federal level regarding the Credit Card Competition Act and follows recent developments in Illinois, where the Interchange Fee Prohibition Act was delayed to 2027 and hit by a federal injunction. For frequent fliers, the veto is significant because interchange fees fund the rewards programs that make travel credit cards valuable. TPG founder Brian Kelly noted the veto protects the seamless payment process and the value of points for consumers. Other state and federal efforts to overhaul the electronic payments system remain under consideration