According to the National Consumer Law Center, “junk fees” are hidden charges attached to goods and services such as concert tickets, airline tickets, or bank loans. These unexpected fees obscure the true price, make a profit off of “gotchas,” and prevent comparison shopping. Junk fees are hidden at best, and false advertising at worst.
If you are a consumer, you have been a “captive” customer. You know the feeling. You want to purchase four tickets for your family to attend a concert. The tickets were advertised as $50 a piece, but when you get to your shopping cart to check out, those four tickets at $50 a piece that you estimated would cost you about $200 plus tax, are now costing you more than $300 because of junk fees. Why is there an additional venue, convenience, or per-ticket fee? All these junk fees make you wonder what the ticket price is actually paying for – if the ticket price doesn’t pay for the venue, what are you paying for within the ticket price? How is there a convenience fee when the only way you could buy these tickets was online? That’s not convenient; that’s the only option.
You are trapped, and the sellers know it – you are officially a “captive consumer.” You promised your family you’d take them to this concert, you’ve spent valuable time searching for the right seat, and you feel like you have no option but to click “yes” and buy the tickets, junk fees and all. Maybe if you had known upfront that tickets were $75 a piece, you never would have promised your family you would take them. You were purposefully misled. That’s why we need price transparency and we need to wrangle in junk fees.
Consumers have had it with junk fees, especially with concert tickets. Recently, the band The Cure learned their $20 tickets ended up costing around $43 after fees – more than double the original price. According to the Houston Chronicle, a nosebleed seat for the NCAA basketball championship game in Houston is listed at $240 on Ticketmaster but when a consumer checks out, a $45.79 service fee and $2.95 processing fee is tacked on. And everyone knows about the Taylor Swift ticket debacle.
Consumers and the free competitive market depend on fair and transparent pricing. Junk fees obscure that market, prevent consumers from comparison shopping, and limit their ability to be reasonable actors in a free market.
These “junk fees” are why I filed House Bill 1497. This bill ensures that any individual who sells or resells tickets for a concert or other event discloses all taxes and fees that the online seller will charge to the consumer in connection with the ticket sale for the event. No more false advertising that a ticket is $60 when, with fees, it’s really $72.
In addition, HB 1497 limits the amount of junk fees a seller can charge as a percentage of the raw ticket price. If a ticket is $50, and your fees are $15, that’s 30% in fees. Texans barely stomach a 6.25% general state sales tax; imagine if they realized they are paying 30% in junk fees.
This bill limits junk fees in connection with the ticket sale so that, in total, junk fees cannot exceed 10% of the ticket price before applicable taxes and fees. So that $50 ticket? You can’t be charged more than $5.00 in additional fees (outside of taxes).
Consumers would never accept junk fees on groceries or clothing. Imagine going to the grocery store check out with a $5 box of cereal in your cart but your total rings up to $12 because there is a $2 per box fee, a $2 store fee, and a $3 convenience fee for using the checkout lane.
HB 1497 will not interfere with what a seller can charge for a ticket. It’s a free market – they can charge whatever the consumer is willing to pay. But those junk fees need to be part of the ticket price, so consumers immediately know what they are paying for before they’re trapped into spending 30% or more on an event than they expected to pay.
I believe all Texans have a right to price transparency and a free, competitive market. By reducing “junk fees” and increasing transparency, Texans can make the best decisions for their families and pocketbooks by comparison shopping with confidence.
Editor’s Note: The above guest column was penned by state Rep. R.D. ‘Bobby’ Guerra of McAllen. A Democrat, Guerra currently serves as chair of the House Committee on Resolutions, vice-chair of the House Committee on Environmental Regulations, and is a member of the House Committee on Energy Resources. He represents the cities of McAllen, Mission, Edinburg, Palmhurst, Pharr and Lopezville.
Editor’s Note: The above guest column appears in The Rio Grande Guardian International News Service with the permission of the author. Rep. Guerra can be reached by email via: [email protected].
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