California Junk Fee Law (SB 478): What Businesses Must Do
What the all-in pricing law requires, which fees can stay out of the price, and how restaurants are treated.
Since July 1, 2024, California's "Honest Pricing Law" (SB 478, Civil Code 1770(a)(29)) has required any price a business advertises, displays or offers to consumers to include every mandatory fee or charge. Only government taxes and fees and actual shipping costs may be added at checkout. Restaurants, bars and other food sellers may still show a fee separately if it is clearly displayed, with its purpose, wherever prices appear (SB 1524).
What the law says
Civil Code 1770(a)(29) makes it an unfair or deceptive practice to advertise, display or offer a price for a good or service that does not include all mandatory fees or charges, other than:
- taxes or fees imposed by a government on the transaction, and
- postage or carriage charges that will be reasonably and actually incurred to ship the physical good to the consumer.
The Attorney General describes it as a ban on "drip pricing", where a low price is advertised and fees are added as you go. In the AG's words, the price a Californian sees should be the price they pay.
Who it covers
The law sits in the Consumers Legal Remedies Act, so it covers goods and services bought for personal, family or household use. Online and in-person sales are both covered. The AG names event tickets (including resale), short-term rentals, hotels and food delivery platforms as examples. Purchases for commercial use are not covered. Two industries have carve-outs:
- Financial entities that must give disclosures under laws such as Truth in Lending, Truth in Savings or RESPA are exempt for those transactions.
- Broadband providers that follow the FCC broadband label rules are treated as complying.
Which fees must be in the price
| Charge | Must be in the advertised price? |
|---|---|
| Service, resort, cleaning, booking or convenience fee the customer can't avoid | Yes |
| Handling charge | Yes |
| Fee to cover rent, security, wages or employee benefits | Yes |
| Card fee when the business accepts only cards | Yes |
| Card fee the customer can avoid by paying cash | No |
| Sales tax and other government fees on the sale | No |
| Actual shipping or postage | No |
| Optional add-ons; late-return or smoking fees | No |
| Voluntary tips | No |
Disclosing the fee before checkout doesn't fix it, and neither does "plus a service fee" next to the price. The AG's FAQ rejects both. What you can do is advertise the total and then show a breakdown of what it includes. Businesses that don't know the final amount up front should wait to show a price until they do.
An example
A hotel lists a room at $199 a night and adds a mandatory $35 resort fee at checkout. That listing violates the law. The hotel must advertise $234 and can still add the hotel occupancy tax at checkout, because that is a government tax.
The restaurant and food rule (SB 1524)
Restaurants, bars, food concessions, grocery stores, grocery delivery services and banquet or catering services may charge a mandatory fee on food and drink outside the item price, but only if the fee is clearly and conspicuously displayed, with an explanation of its purpose, on any advertisement, menu or other display that shows the price. A line at the bottom of the menu saying what the fee is and what it pays for is the usual approach. Third-party food delivery platforms are expressly excluded, so a delivery app must show its delivery service price all-in. Since July 1, 2025, "clearly and conspicuously" has the specific meaning in Civil Code 1791(u).
Penalties
- Consumer lawsuits under Civil Code 1780: actual damages (at least $1,000 in total in a class action), an injunction, restitution, punitive damages and attorney's fees for a winning consumer.
- Public enforcement under the Unfair Competition Law: civil penalties of up to $2,500 per violation, in suits by the Attorney General, district attorneys and certain city attorneys (Business and Professions Code 17206).
Federal rules can apply too. The FTC's Rule on Unfair or Deceptive Fees (16 CFR Part 464) requires total-price disclosure for live-event tickets and short-term lodging nationwide.
Run your numbers
Enter your advertised price and fees in the Junk Fee Compliance Checker to see which fees must be included and the all-in price to show. If you sell goods, check your sales tax registration with the Seller's Permit Checker.
Frequently Asked Questions
When did the California junk fee law take effect?
July 1, 2024. SB 478 added Civil Code 1770(a)(29), and SB 1524 amended it the same day to add the rule for restaurants and other food sellers.
Does SB 478 limit how much a business can charge?
No. It is a transparency law, not a price cap. A business can charge what it likes and can itemize fees, but the price it advertises or displays must already include every mandatory fee.
Can a restaurant add a service charge in California?
Yes, if the charge is clearly and conspicuously shown, with an explanation of its purpose, on every menu, ad or display that shows prices. Third-party delivery apps don't get this exemption.
Do I have to include shipping and taxes in my price?
No. Taxes or fees the government imposes on the sale, and postage or carriage costs actually incurred to ship a physical good, can be added later. Handling charges must be included.
Who enforces the junk fee law?
Consumers can sue under the Consumers Legal Remedies Act, and the Attorney General, district attorneys and some city attorneys can seek civil penalties of up to $2,500 per violation under the Unfair Competition Law.
This article is for general information only and is not legal advice. Sources: Civil Code 1770(a)(29), (c) and (d), 1761 and 1780; Business and Professions Code 17206; California Attorney General, SB 478 Hidden Fees FAQ; 16 CFR Part 464.