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I ate at a Croatian restaurant where I had the option to pay with cash with euros or pay with my credit card.

If I chose to pay with cash, I would be given a 10% discount.

As I have a VISA credit card issued in another EU country, this discount seems to be against the law.

According to https://europa.eu/youreurope/business/finance-funding/making-receiving-payments/electronic-cash-payments/index_en.htm :

Card surcharges are not allowed

You're not allowed to charge your customers extra for using a credit or debit card. This applies to all card purchases (in shops and online) made throughout the EU.

So, is it a legal loophole to give discounts for paying with cash instead of adding a surcharge for paying with a credit card?

Or is this actually illegal?

Tyilo
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1 Answers1

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Yes, its legal

Economically, there is no difference between a cash discount and a card surcharge; legally, there is. That’s because the law prohibits charging more than the advertised price for a given payment method but doesn’t prohibit charging less.

Of course, it’s likely there is some illegality here but it’s not against the customer. A business doesn't give a 10% discount to avoid paying a 1-2% fee. They do it because they are not reporting (some of) their cash sales to the tax authorities and are therefore saving the 25% VAT and 18% company tax.

Dale M
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