Today, Americans for Tax Reform (ATR) announced that Senators will receive a positive rating in the annual Congressional Scorecard for supporting Sen. Jon Tester’s (D-Mont.) amendment to delay and further study price controls on debit card transactions.
The Section 1075 (Durbin Amendment) price controls that were contained in the Dodd-Frank financial reform act are poised to dramatically alter the market for debit cards. Capping the interchange fee substantially lower than current levels will shift enormous costs onto consumers and smaller banks, potentially leading to the elimination of services.
The interchange fee regulations violate free-market principles and property rights, setting below-cost price controls and depriving card issuers of a return on capital invested. For this reason, 33 prominent free-market think tanks, advocacy groups, and other organizations previously sent a letter to Congress supporting efforts to roll back these onerous regulations.
Sen. Tester has proposed a reasonable measure that will delay the implementation of these burdensome rules and further study their impact on consumers and markets. This is a prudent step considering that the Government Accountability Office has already found that similar price controls in Australia cost consumers in higher annual fees.
ATR urges all members to support the Tester amendment to delay implementation of interchange price controls. Failure to support this measure is a failure to stand up for free-markets and American consumers.
A vote in favor of the Tester amendment will be scored positively in Americans for Tax Reform’s annual Congressional Scorecard.