During his State of the Union speech, President Joe Biden claimed that his administration is adamant about eliminating junk fees throughout various sectors, such as hotels, airlines, banks, and other service businesses.
It is safe to say that junk fees have been controversial for many years, especially in the travel industry. For instance, customers often have to pay a small convenience fee during an online transaction or credit card payment. However, all of this is likely to end soon.
President Joe Biden has put forward new legislation to eliminate junk fees usually passed on to the customers’ bills.
It should be noted that junk fees are extra charges that are not included in the initial price of a service. They are often hidden and only demanded at the time of payment.
Nearly 85% of Americans have had to pay junk fees at some point. They could be included in credit card bills, air travel expenses, and the cost of concert tickets labelled as convenience or service fees. Customers have to pay them at the time of making a purchase.
Reports suggest that US hotels earned billions in 2018 by charging resort or destination fees associated with certain amenities, like free gym, internet service, etc.
Moreover, airlines also charge extra for passengers who wish to book a specific seat in advance. For example, families travelling with children have to pay a significant amount of money, so they can sit together.
Needless to say, these extra, hidden charges frustrate travellers since airlines and hotels often include them during the final stages of confirming a booking.
How Will The New Legislation Help Travellers?
The new legislation to remove junk fees will hold the Department of Transportation responsible for ensuring online travel agencies and airlines disclose all charges upfront. These also include fees for making any changes, baggage, and cancellation.
Similarly, hotels and booking websites would be required to disclose all fees to customers beforehand.
Undoubtedly, the new legislation could help reduce the stress on travellers since hidden charges exist in all types of services.
However, some people think the new legislation would increase hotel rates and airline ticket prices.
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This blog was initially published on April 10, 2023.