EXPLAINER What are junk fees? May 2024 Summary The term “junk fees” has invaded the lexicon of the federal government as the executive branch attempts to place controls on a wide range of private businesses. [...] The Federal Trade Commission and the White House attach the term to any and all purchase fees, most frequently charged by businesses in the service industry. [...] Overdraft fees Hotel resort fees Why is the government’s push to eliminate junk fees a problem? The unintended consequences EXAMPLE: A woman purchases an airline ticket for a quick weekend getaway of overburdensome regulation with friends. [...] While the idea of banning these fees may sound appealing, more often than not the overburdensome regulation results in more harm to the consumer. [...] Banning the fees does not make them disappear; instead, they are wrapped into the cost of the broader service, resulting in less price transparency and higher average prices.
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