Companies will have to disclose the full cost of everything from hotel rooms to concert tickets upfront starting July 1, when a new state law takes effect banning so-called junk fees — those hidden costs that get tacked onto a bill right before you pay.
However, the restaurant industry won’t be included after some last-minute political wrangling in Sacramento that led to an eleventh-hour exemption.
Businesses of all kinds pushed back when lawmakers were considering the bill, arguing that false advertising is already banned in California and that in many industries, prices are already heavily regulated. One main point of contention for the California Chamber of Commerce and others was the provision allowing private citizens — not just the government — to sue if they encounter junk fees.
But the restaurant industry also lobbied lawmakers for a carveout in recent weeks, saying they didn’t know when the legislation was being debated last year that it included menu charges.
Many restaurant owners argued that by eliminating service charges from bills, it would force them to include those extra costs in menu prices or pay employees less. But many diners have complained that the fees are hidden and they don’t know who they are actually going to when they pay their bill.