Credit card processing and merchant services in Kansas
Kansas replaced its old surcharge ban with a disclosure rule on January 1, 2025, and cut the state tax on groceries to zero the same day. Both changes affect how you set up checkout.
Card surcharges
Allowed with limitsKansas allows credit card surcharges if you disclose the amount at the point of entry or sale first; network caps of 3% and 4% apply.
Sales tax
6.5% state rate, plus local
Last checked
October 6, 2026
If you read that Kansas bans credit card surcharges, you read something out of date. K.S.A. 16a-2-403 had barred them since 1986. On February 25, 2021, a federal court in Kansas ruled for CardX, a surcharging technology company, in its challenge to that ban, according to a Goodwin Procter summary of the case. Then the legislature rewrote the section, effective January 1, 2025.
The current statute lets you add a surcharge when a customer pays by credit card, as long as you disclose the amount with a clear and conspicuous notice at the point of entry or the point of sale before the transaction. Kansas sets no percentage cap. Visa's 3% and Mastercard's 4% caps apply instead, along with the rule that a surcharge can't exceed your cost, and neither network allows surcharging debit or prepaid cards.
Grocers got a bigger change that same day. Since January 1, 2025, the state sales tax on food and food ingredients has been 0%, down from 2% in 2024. Prepared food is still taxed at the full 6.5% state rate, as are most other taxable goods, and various cities and counties add a local sales tax. A store that sells groceries and hot food needs those set up as different tax categories.
Border businesses should note which side of the state line they're on. A location in Kansas City, Missouri follows Missouri law, and our Kansas City, Missouri page covers that side.
Clearo's surcharging program includes the disclosure Kansas requires, and interchange-plus pricing may make a surcharge unnecessary. Start with a free statement review and decide from there.
What Kansas merchants should know
Credit card surcharges in Kansas
Since January 1, 2025, K.S.A. 16a-2-403 allows a business to impose a surcharge on a customer who pays by credit card if it discloses the amount of the surcharge through a clear and conspicuous notice at the point of entry or the point of sale, in advance of the transaction. The statute sets no cap.
The card networks do. Visa caps a surcharge at the lower of your merchant discount rate or 3%, Mastercard at the lower of your average effective rate or 4%, and neither allows surcharges on debit or prepaid cards. Visa also requires 30 days' written notice to your acquirer.
Sources: Kansas Legislature, K.S.A. 16a-2-403 (2026 Kansas Statutes); Visa, U.S. Merchant Surcharge Q and A; Mastercard, Credit card surcharge rules and fees for merchants
How the old ban ended
The earlier version of 16a-2-403, dating to 1986, barred surcharges on credit and debit cards. On February 25, 2021, the U.S. District Court for the District of Kansas granted summary judgment to CardX in its challenge to the ban, according to a Goodwin Procter summary of the ruling. The 2024 session law (L. 2024, ch. 6) then replaced the ban with the disclosure rule, effective January 1, 2025.
The statute's history lists amendments in 1999, 2010 and 2024; there was no 2018 repeal.
Sources: Goodwin Procter (law firm), State statute prohibiting surcharges on credit card purchases held unconstitutional (March 2021); Kansas Legislature, K.S.A. 16a-2-403 (2026 Kansas Statutes); NCSL, Credit or debit card surcharges statutes (table updated October 13, 2016, shows the old Kansas ban)
Sales tax and the food rate
The state sales tax rate is 6.5%, and various Kansas cities and counties add a local sales tax. Since January 1, 2025, the state rate on food and food ingredients has been 0%, down from 2%. Prepared food is still taxed at the full 6.5% state rate, so program groceries and prepared food as separate categories.
Sources: Kansas Department of Revenue, Frequently asked questions about sales; Kansas Department of Revenue, Publication 1223, Food sales tax rate reduction (PDF); Kansas Department of Revenue, Sales (retailers)
Payment services we provide
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Common questions
Are credit card surcharges legal in Kansas?
Yes. Since January 1, 2025, Kansas law allows them if you disclose the surcharge amount with a clear and conspicuous notice at the point of entry or point of sale before the transaction. There's no state percentage cap, so Visa's 3% and Mastercard's 4% caps apply, and debit and prepaid cards can't be surcharged.
Didn't Kansas repeal its surcharge ban in 2018?
No. The statute's history lists amendments in 1999, 2010 and 2024, and the ban stayed in the text until the 2024 rewrite took effect on January 1, 2025. In between, a federal court ruled for CardX against the ban in February 2021, according to law firm summaries of the case.
Do Kansas grocery stores charge sales tax on food?
Not the state portion. Since January 1, 2025, the state sales tax rate on food and food ingredients has been 0%, down from 2% in 2024. Prepared food is still taxed at the full 6.5% state rate. Check your local rate and set up separate categories on your POS terminals.
Which rules apply to a business near the Missouri line?
The rules of the state where the business is located. A store in Kansas follows the Kansas disclosure rule for surcharges and Kansas sales tax. A location in Kansas City, Missouri follows Missouri law, which has no surcharge statute; see our Kansas City, Missouri page.
Other states we serve besides Kansas
- Alabama
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Idaho
- Illinois
- Indiana
- Iowa
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- Washington, DC
- West Virginia
- Wisconsin
- Wyoming
Disclaimer: general information, not professional advice
This page is general educational information, not legal, tax, accounting or financial advice. Rules and rates vary by place and change, so confirm them with the official source and a qualified professional before you act. Full terms are in our Terms of Service.
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