Hotel Fees Transparency Act of 2025
- Sponsor
- Sen. Klobuchar, Amy [D-MN]
- Committees
- Commerce, Science, and Transportation Committee (primary)
- Last action
- May 14, 2025
Bottom line
The Hotel Fees Transparency Act of 2025 aims to eliminate hidden 'junk fees' in lodging advertising by requiring all mandatory charges to be included in the initial displayed price, thereby enhancing price transparency for consumers.
What it actually does
This bill prohibits hotels, short-term rentals, and third-party booking platforms from displaying or advertising a price for lodging that does not clearly and prominently include the total services price, encompassing all mandatory fees. It mandates the disclosure of any government-imposed taxes or assessments prior to final purchase. Violations are treated as unfair or deceptive acts under the Federal Trade Commission Act, allowing both the FTC and state attorneys general to enforce the provisions.
Proponents argue
Proponents argue that the bill protects consumers from deceptive pricing practices by ensuring they see the full, non-optional cost of lodging upfront, preventing hidden fees from being added later in the booking process. They contend it fosters fair competition among lodging providers and booking platforms by standardizing price display and empowering consumers to make informed decisions.
Opponents contend
Opponents might argue that the bill could impose significant compliance burdens on smaller lodging providers and booking platforms, potentially leading to increased operational costs or higher initial displayed prices that could deter consumers. They may also contend that some fees, particularly government-imposed taxes, are variable and distinct from business-imposed service fees, making their upfront inclusion complex.
The bill is relatively short and clearly written, making it accessible for a quick read and understanding of its core provisions.
Section 2(a)(1)
Total Services Price Display Requirement
This provision makes it unlawful for hotels, short-term rentals, and booking platforms to advertise a price for lodging without clearly, conspicuously, and prominently displaying the 'total services price.' This total price must include the base rate and all mandatory service fees, and must be shown at the first display of the service and anytime thereafter throughout the purchasing process. Government-imposed taxes and fees must be disclosed prior to the final purchase.
Supporters argue
Supporters argue this provision directly addresses 'junk fees' by forcing full price transparency from the outset, empowering consumers to make informed decisions without encountering hidden costs later in the booking process.
Critics contend
Critics might argue that requiring all fees upfront could make initial prices appear higher, potentially deterring consumers who might otherwise proceed with a booking, or that it overregulates pricing displays.
Tradeoffs
Balances consumer protection through transparency against potential impacts on pricing strategies and initial consumer perception of cost.
Section 2(a)(2)
Permissible Display of Individual Components
This section clarifies that the bill does not prevent covered entities from displaying individual components of the total price (e.g., base rate, specific service fees) or details of optional items, as long as the total services price remains more prominent than these itemized components.
Section 2(b)(1)
Federal Trade Commission Enforcement
Violations of the pricing transparency requirements are to be treated as violations of a rule defining an unfair or deceptive act or practice under the Federal Trade Commission Act. This grants the FTC the authority to enforce the provisions using its existing powers, duties, and jurisdiction, including imposing penalties and seeking consumer redress.
Section 2(b)(2)
State Attorney General Enforcement
State attorneys general are authorized to bring civil actions on behalf of their residents in an appropriate district court of the United States if they believe a violation of the Act has occurred. States must notify the FTC before initiating such an action, and the FTC has the right to intervene. A state cannot bring an action if the FTC has already instituted one against the same defendant for the same alleged violation.
Section 2(b)(3)
Affirmative Defense for Intermediaries
Third-party online sellers (such as booking websites) can assert an affirmative defense in enforcement actions if they can demonstrate they established procedures to receive up-to-date price information from lodging providers, relied in good faith on inaccurate information provided by a lodging provider, and took prompt action to remove or correct any false or inaccurate information after receiving notice.
Section 2(c)
Federal Preemption of State Laws
The Act preempts any state or local law that prohibits or affects how covered entities advertise prices for covered services, if that state law requires fee disclosure but does not mandate that the 'total services price' include every service fee in accordance with this federal Act. It explicitly states that it does not preempt state laws related to contracts, torts, fraud, or data security.
The definition of 'total services price' explicitly excludes 'any taxes or fees imposed by a government or quasi-government entity,' 'any assessment fees of a government-created special district or program,' and 'any charges or fees for an optional product or service.'
Section 2(d)(12)
Why it matters:While placing definitions at the end is standard legislative practice, the specific exclusions here are highly consequential for the practical application of the bill's transparency mandate.
Case for: Supporters argue that government taxes and truly optional services are distinct from mandatory 'junk fees' imposed by businesses. Their exclusion from the initial 'total services price' allows for more accurate comparisons of the core lodging cost, as these excluded items can vary significantly by location or consumer choice.
Case against: Consumer advocates might argue that *all* mandatory charges, including government taxes and special district fees, should be included in the initial displayed price to give consumers the absolute final cost, as these are not truly optional once a location is chosen, and their exclusion still requires consumers to calculate the full price.
Estimated impact: This exclusion means that while mandatory service fees will be included upfront, government taxes and certain local assessments will still be added later in the booking process, potentially adding a substantial percentage to the displayed 'total services price.'