All You Need to Know About Price Gouging Laws by State - Outsource Bookkeeping Service Providers

One thing you never want to do is take advantage of your customers, especially during national emergencies. But sometimes, you may need to increase your prices to keep up with demand or inflation. Where do you draw the line between a standard price increase and price gouging?

Not only can price gouging result in penalties, but it can also harm your small business reputation. To prevent it, learn what it is, price gouging laws by state, and how to stay compliant.

What is price gouging?

Price gouging is when a seller significantly and excessively raises the pricing of their products or services. Some businesses may price gouge when there’s a sharp uptick in demand, a shortage of supplies, or both. The majority of states have laws stating that price gouging is illegal during a disaster or state of emergency. Price gouging laws are a type of consumer protection.

To combat price gouging, a number of states actively monitor supply, demand, and company prices before and during disasters or emergencies. And, consumers can report businesses to their Attorney General’s office (usually) if they suspect price gouging.

Price gouging is not when you reasonably raise your prices to keep up with inflation. Some consumers may angrily accuse you of price gouging, but this is not the correct term.

There have been thousands of price gouging complaints during the coronavirus pandemic. Here are some examples of actual price gouging situations during COVID-19:

$3,799: 15 N95 face masks
$10: 1 gallon of milk
$79.99: 36 rolls of toilet paper

Price gouging laws by state

Although there isn’t a federal law against it, the majority of states have anti-price gouging laws. And, some states without laws explicitly against price gouging can issue executive orders to prohibit the action during times of emergency (e.g., coronavirus).

State price gouging laws can vary by:

What is considered price gouging
When price gouging laws apply
Products or services the law applies to
Lookback period for price comparisons before and during emergency declaration
Penalty type (fines or jail time) and amount

So, which states have price gouging laws, and what are they?

The following states do not have price gouging laws in place:

Alaska	Montana	North Dakota
Arizona	Nebraska	Ohio
Colorado	Nevada	South Dakota
Delaware	New Hampshire	Washington
Minnesota	New Mexico	Wyoming

Keep in mind that states without price gouging laws may still take efforts to prevent price gouging, especially during national emergencies. For example, Ohio has state laws that ban “unconscionable sales practices” but not a law specifically against price gouging.

The remaining states do have price gouging laws. Read on to learn the basics of the price gouging laws by state.

Alabama

Alabama’s price gouging law is known as the “Alabama Unconscionable Pricing Act.” It is triggered in a state of emergency.

Here are some basic facts about the law:

What is considered price gouging: 25% or more price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: 30 days prior to declared state of emergency
Penalty: Civil penalty of $1,000 per violation; maximum $25,000

Arkansas

Arkansas’ Act 376 of 1997 makes price gouging illegal during a state of emergency.

Take a look at what Arkansas’ price gouging law includes:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Anything needed during an emergency
Lookback period for price comparisons: Pre-emergency price
Penalty: Up to a $10,000 penalty, plus restitution to consumers, costs, injunctive relief, attorneys’ fees, and possible criminal sanctions

California

California’s anti-price gouging statute is included in the Penal Code Section 396. Here’s what to know about the state’s law:

What is considered price gouging: 10% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All major necessities
Lookback period for price comparisons: Before the emergency is declared
Penalty: Up to a $10,000 penalty, one year of jail time, or both; also subject to civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution

Connecticut

Although Connecticut has a price gouging and profiteering law, details about it may vary on a case-by-case basis and are left up to the state. Connecticut’s law goes into effect during certain types of declared emergencies.

To learn more about the state’s law, visit Connecticut’s Department of Consumer Protection website.

D.C.

D.C.’s law goes into effect during a state of emergency. Here’s what it contains:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: 90 days prior to the declaration
Penalty: $5,000 per violation

Florida

Florida’s price gouging law is under Florida Statute 501.160.

What is considered price gouging: “Gross disparity” between prices before and during a state of emergency
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Essential goods and services
Lookback period for price comparisons: 30 days before the state of emergency declaration
Penalty: $1,000 per violation, maximum $25,000 for multiple violations in a 24-hour period; violators can also be charged with a second-degree misdemeanor

Georgia

Georgia’s price gouging law is governed under the Georgia Department of Law, Consumer Protection Division:

What is considered price gouging: Price increases that don’t accurately reflect an increase in the cost to make or transport the item
When price gouging laws apply: During a state of emergency
Products or services the law applies to: “Goods and services ‘necessary’ to preserve, protect, or sustain the life, health, or safety of persons or their property”
Lookback period for price comparisons: 10 days before the state of emergency declaration
Penalty: $2,000 – $15,000 per violation

Hawaii

Hawaii’s anti-price gouging law, Section 127A-30, HRS, triggers when there is an emergency declaration. Take a look at the main points:

What is considered price gouging: Any price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Goods/commodities
Lookback period for price comparisons: Before the emergency is declared
Penalty: $500 – $10,000 fines per day, per violation

Idaho

The Idaho Consumer Protection Act has a statute devoted to preventing price gouging. Check out the lowdown on Idaho’s price gouging rules:

What is considered price gouging: Exorbitant or excessive price increases
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Fuel, food, drugs, or water
Lookback period for price comparisons: Before the declaration
Penalty: $5,000 per violation, plus restitution and injunctive relief

Illinois

Illinois’ price gouging law, Motor Fuel Fair Marketing Practices Act, kicks in during a market emergency:

What is considered price gouging: Pricing above the regional Oil Price Information Service average on the previous day for unleaded regular gasoline or No. 2 low sulfur clear diesel fuel, plus $0.25 per gallon, and $0.04 per gallon transportation expense
When price gouging laws apply: During a market emergency
Products or services the law applies to: Motor fuel
Lookback period for price comparisons: Before the disaster
Penalty: $1,000 per violation

Indiana

Indiana’s Fuel Price Gouging Law prohibits price gouging on fuel products during a state of emergency:

What is considered price gouging: “Unconscionable” prices, based on gasoline prices
When price gouging laws apply: State of emergency (disaster/emergency powers or energy emergency)
Products or services the law applies to: Fuel products
Lookback period for price comparisons: Seven days before the declaration of the state of emergency
Penalty: $1,000 fine per transaction, plus restitution and injunctions

Iowa

Iowa’s law against price gouging is included under the Consumer Fraud Act, Iowa Code section 714.16. Here’s what it says:

What is considered price gouging: “Excessive prices” on merchandise
When price gouging laws apply: During a state of emergency and recovery period
Products or services the law applies to: All
Lookback period for price comparisons: Immediately before the onset of the emergency
Penalty: Up to $40,000

Kansas

The Kansas Consumer Protection Act does not allow “unconscionable” price gouging and profiteering from disaster:

What is considered price gouging: More than 25% price increase
When price gouging laws apply: During a state of emergency or disaster
Products or services the law applies to: Necessary property or services
Lookback period for price comparisons: Business day before the disaster
Penalty: Up to $10,000 per violation

Kentucky

Here’s a rundown on Kentucky’s laws against price gouging:

What is considered price gouging: Price increases that are “grossly in excess of the price prior to the declaration”
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: Up to $25,000 for multiple price gouging violations within a 24-hour period and restitution

Louisiana

Want the scoop on Louisiana’s laws? Take a look at the basics:

What is considered price gouging: “Increase in prices or value for goods and services that are higher than the prices ordinarily charged for comparable goods and services”
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: Immediately before the time of a state of emergency
Penalty: $500 fine, six months in prison, or both; higher fines for actions that result in death

Maine

Maine’s law prevents profiteering during emergency situations. Here are some basic facts about the state’s law:

What is considered price gouging: More than 15% increase
When price gouging laws apply: During an abnormal market disruption
Products or services the law applies to: Necessities
Lookback period for price comparisons: Immediately before the abnormal market disruption
Penalty: Up to $10,000

Maryland

Maryland’s anti-price gouging statute protects consumers against the action:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Necessities
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: $10,000 per violation

Massachusetts

Massachusetts’ price gouging law is triggered during an emergency situation:

What is considered price gouging: An “unconscionably high price”
When price gouging laws apply: During a statewide or national emergency
Products or services the law applies to: Goods and services necessary for public health and safety
Lookback period for price comparisons: Before the state of emergency
Penalty: Contact the state for information on penalties

Michigan

Michigan’s Consumer Protection Act has a price gouging rule that applies all the time, whether there’s a declared emergency or not:

What is considered price gouging: A “grossly in excess” price compared to other sellers’ goods and services
When price gouging laws apply: Always
Products or services the law applies to: All
Lookback period for price comparisons: N/A
Penalty: Contact the state for penalty information

Mississippi

Mississippi’s Attorney General Office offers a guide to price gouging, including:

What is considered price gouging: Price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All products
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: $1,000 – $5,000 (depending on the situation), confinement time, or both

Missouri

Missouri offers a consumer guide to price gouging, which outlines information such as:

What is considered price gouging: “Large” increases in price
When price gouging laws apply: After a disaster
Products or services the law applies to: Necessities
Lookback period for price comparisons: Before the disaster
Penalty: Up to $1,000 per violation

New Jersey

New Jersey’s law against price gouging is included in the state’s Consumer Fraud Act:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a declared state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: $10,000 for the first offense and $20,000 for subsequent offenses

New York

New York’s Consumer Protection Law prohibits price gouging during an emergency:

What is considered price gouging: 10% or more price increase
When price gouging laws apply: During an emergency
Products or services the law applies to: Necessities
Lookback period for price comparisons: Before the emergency declaration
Penalty: Up to $500 per product or service

North Carolina

North Carolina’s law against gouging is triggered during an emergency situation:

What is considered price gouging: Excessive prices
When price gouging laws apply: During an emergency, disaster, or market disruption
Products or services the law applies to: Critical goods and services
Lookback period for price comparisons: Before the emergency declaration
Penalty: Up to $5,000 per violation and refunds

Oklahoma

Oklahoma’s statute against price gouging covers the following information:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a declared emergency
Products or services the law applies to: All
Lookback period for price comparisons: Before the emergency declaration
Penalty: $10,000 per violation

Oregon

Oregon’s price gouging law kicks in during an abnormal market disruption:

What is considered price gouging: 15% or more price increase
When price gouging laws apply: Abnormal market disruption declaration
Products or services the law applies to: Essential goods and services
Lookback period for price comparisons: Immediately before market disruption started
Penalty: Contact the state for penalty information

Pennsylvania

Pennsylvania’s Price Gouging Act is triggered by a market disruption:

What is considered price gouging: 20% or more price increase
When price gouging laws apply: Market disruption (e.g., weather, emergencies, stockpile depletion, etc.)
Products or services the law applies to: All
Lookback period for price comparisons: Before the state of disaster emergency
Penalty: Up to $10,000 per violation

Rhode Island

Price gouging is illegal in Rhode Island. The details include:

What is considered price gouging: “Unconscionably high price”
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Essential commodities
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: Up to $1,000 per violation; maximum fine of $25,000 during a 24-hour period

South Carolina

South Carolina’s laws against price gouging prevent businesses from overcharging consumers. Here are the details:

What is considered price gouging: “Much higher price”
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: 30 days before state of emergency declaration
Penalty: Up to $1,000, 30 days jail time, or both

Tennessee

Price gouging is illegal under a Tennessee statute, which outlines the following information:

What is considered price gouging: “Grossly in excess” price compared to normal prices
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Emergency supplies, medical supplies, and consumer food items
Lookback period for price comparisons: Before the state of emergency declaration
Penalty: Refunds and possible fines of $1,000 per violation

Texas

Here’s a look at Texas’ laws against price gouging:

Utah

Utah’s law is known as “Price Controls During Emergencies Act.” Take a look at the following information relating to the state’s price gouging law:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: 30 days before the emergency declaration
Penalty: Up to $1,000 per violation; max $10,000 per day

Vermont

Take a look at the 411 for Vermont’s laws against price gouging:

What is considered price gouging: Unconscionably high prices
When price gouging laws apply: During a market emergency
Products or services the law applies to: Petroleum and heating fuel products
Lookback period for price comparisons: More than seven days before market emergency declaration
Penalty: Contact the state for penalty information

Virginia

The Virginia Post-Disaster Anti-Price Gouging Act prevents businesses from engaging in price gouging:

What is considered price gouging: “Unconscionable” prices
When price gouging laws apply: During a state of emergency
Products or services the law applies to: Necessary goods and services
Lookback period for price comparisons: 10 days before the disaster
Penalty: Check with the state for penalty information

West Virginia

Curious about West Virginia’s price gouging law? Here’s the rundown:

What is considered price gouging: More than 10% price increase
When price gouging laws apply: During a state of emergency or preparedness
Products or services the law applies to: Good or service that’s necessary for health, safety and welfare
Lookback period for price comparisons: 10 days before declaration
Penalty: Up to $1,000 fine, one year jail time, or both

Wisconsin

Wisconsin’s ban against price gouging includes the following details:

What is considered price gouging: More than 15% price increase
When price gouging laws apply: During a state of emergency
Products or services the law applies to: All
Lookback period for price comparisons: 60 days before a declared emergency
Penalty: Up to $10,000 fine

Reducing your business’s liability

If you’re concerned about getting accused of price gouging, there are a few things you can do to protect your business.

This probably goes without saying, but the only way to reduce your business’s liability is not to price gouge. Avoid charging customers exorbitant prices just because you can.

To protect your business from price gouging accusations, you must:

Understand your state’s price gouging laws
Keep business records detailing your costs and pricing history
Come up with fair price increases that you can explain
Analyze similar product or service pricing to ensure your prices are on par

To avoid price gouging, you need detailed business records. With Patriot’s online accounting software, you can securely manage receipts and documents all within your account. Get your free trial now!

This is not intended as legal advice; for more information, please click here.