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News & ArtsThursday, January 28, 2010
Olympia Higher or Lower ATM Fees?
Posted by Unpaid Intern on Thu, Jan 28, 2010 at 4:35 PM
Posted by news intern Jon Brock
Today in Olympia, state senator Randy Gordon (D-41) filed a bill that would impose an additional tax on banks and other institutions that charge ATM fees or surcharges in excess of $1.50.
The more the banks charge, the more the banks would have to pay. The bill would impose the charge "on the gross income of a financial institution from automated teller machine access fees or surcharges in excess of one dollar and fifty cents." In other words, everything over $1.50 would be taxed, says Gordon. If passed, the state would slap on a five percent tax on the gross ATM fees between $1.50 and $2.00, a 7.5 percent tax on fees between $2.00 and $2.50, and 10 percent tax on charges above $2.50.
For example, many of the Chase ATMs (and other banks, too) charge $3.00 per transaction. That's a $0.15 tax on the bank (10 percent of the amount over $1.50). One one hand, all those ATM fees could help the state generate revenue to help close its budget gap.
But there are two question this raises: Could this possibly persuade banks to drastically lower their expensive ATM fees? Or could banks just raise the price of those ATM fees even higher to make up for the tax? Regarding the latter, senator Gordon says, "I think not. If their repsonse is to go raise fees, then the leguslature can raise the rates." Gordon adds, "The higher their fees, the higher the amount the community will get back from those excess profits." The bill, which Gorton says has support from the Senate Democratic leadership, also mandates a review of the policy in 2015 to see if banks have raised ATM fees.
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If your keeping score at home, that would be 0.1% of a billion dollars. And how many billions is the state in deficit?
Hey, that's one dumb idea down and only 999 to go!
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and they have the best credit card currently available too.
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So, I have to use a local (Greek) ATM. Not only do I get charged $5 for using an out-of-network ATM (there are no "network" ATMs in Europe, I've checked), for years I also got charged for the exchange rate calculation (dollars to euros and/or vice versa). They did give up the exchange rate charge.
But we can't just take a lump sum of money out each month because 1) the exchange rate changes daily and 2) this is a cash economy. People don't use credit cards except when purchasing big ticket items (like cars) or at grocery stores. If you need a plumber, electrician, or your car repaired - you'd better have cash - because they don't take credit cards. Nor does the pharmacy or the doctor.
In one sense, cash is better because you don't pay interest on it and it alleviates some unnecessary steps toward destitution.
I don't know if this will raise money for the state or not, but it would be nice to not have to keep paying these fees, over and over.
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