No ID, No Sale in Texas

New law will allow retailers to ask customers for a photo ID with credit and debit card purchases.

August 15, 2017

AUSTIN – A new Texas law that goes into effect on January 1 will allow merchants to decline card purchases made without a valid photo ID, reports the Texas Tribune.

The goal of the new law is to reduce debit and credit card fraud, notes the news source, adding that merchants can currently ask to see photo ID; however, their contracts with card companies often bar them from declining a transaction if a customer refuses to show it.

“I think most people, like me, were surprised that merchants cannot already do this,” state Sen. Bryan Hughes, who authored the legislation, told the news source. “The intent of the law is to give Texas businesses the right to take this common-sense step of asking for an ID for a credit card transaction.”

Because the new law says merchants may decline a transaction if ID is not provided, “it’s not necessarily requiring them to violate their contract,” Colin Marks, a professor at St. Mary’s University School of Law and an expert on contracts, told the news source. He adds that card companies could tell merchants that the law “doesn’t require you to turn [customers who don't show ID] down, and you contractually agreed that you would not.”

Keith Strama, a lobbyist for Visa, says that the law could be confusing to retailers. “The last thing we want to do is get in a legal dispute about how this bill applies to our contracts,” he said, adding that the measure could penalize Texans without photo ID who use debit cards issued by the government for certain benefit programs.

Groups opposing the measure include a state retailer association, notes the news source, whose lobbyist suggested that allowing employees to determine which customers must show an ID could be perceived as discriminatory or biased.

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