Government Announces Crackdown on Subscription Traps and Misleading Discounts

Prime Minister Andy Burnham has unveiled plans to target deceptive business tactics as part of a package of "everyday fixes" designed to ease the pressure of the cost-of-living crisis for UK households.

The measures target two widespread retail practices: misleading discount claims and hidden recurring payments, which ministers estimate cost consumers hundreds of millions of pounds annually.

Banning "Pretend Prices"

The government intends to outlaw retail strategies that use artificial reference points to simulate savings. A formal consultation launching this autumn will examine adding deceptive pricing tactics to the list of banned commercial practices under the Digital Markets, Competition and Consumers Act (DMCCA), making them automatically illegal without requiring regulators to prove direct consumer harm.

Targeted practices include:

• Fake "Was" Prices: Inflating a product's price for a brief window before slashing it to make savings appear larger.
• Invented Reductions: Advertising discounts that match pre-sale pricing.
• Misleading Recommended Retail Prices (RRPs): Utilizing inflated reference prices to create a false sense of value.

"If something is advertised as half price, it should actually be half price. We’re also making it as easy to leave a subscription as it is to join," Burnham said in a statement, adding:

"I know people are sick and tired of rip-off discounts and subscription traps. Westminster has got used to telling people that everyday hassles like this are just part of life. I don’t think that’s right, especially when the cost of living continues to weigh heavily on so many people’s lives. I’m determined to pull every single lever we can to provide people with some room to breathe on the cost of living."

Overhauling Subscription Protections

Ministers are accelerating the timeline for new subscription regulations originally scheduled for spring, moving the implementation date forward to January 2027.

Under the updated framework, businesses will be required to provide clear upfront information, issue regular contract reminders, and establish straightforward cancellation processes. A mandatory 14-day cooling-off period will also allow customers to exit contracts following a free trial conversion or long-term renewal.

Certain heritage and cultural charities will be exempt from the new subscription rules to preserve their unique public access models.

Stakeholder Reactions and Political Fallout

Consumer advocates broadly welcomed the announcement, while political opponents criticized the timing and origin of the policy framework.

"Which? has repeatedly exposed businesses, including trusted household brands, ripping off customers with dodgy deals that aren’t what they seem - but regulators have often found it too difficult to take action. It’s great news that the government intends to tighten up the law and explicitly ban misleading pricing practices, while putting an end to subscription traps,” said Sue Davies MBE, Head of Consumer Rights Policy at Which?.

Dame Clare Moriarty, Chief Executive of Citizens Advice, called the announcement "an important move" while noting it "can’t be the end of the story."

Opposition figures questioned the novelty of the announcement. Shadow Chancellor Mel Stride described the measures as "reheated" policies originating from previous administrations, stating:

"The cost of living didn't become a problem last week, so you have to ask why it has taken Labour so long to enact legislation passed by the previous government."

Liberal Democrat Treasury spokesperson Daisy Cooper urged the government to expand protections further by targeting retail "shrinkflation" and rogue trading. Meanwhile, Burnham is set to conduct a UK-wide summer tour to gather public input on further cost-of-living measures ahead of Chancellor John Healey's upcoming budget on October 28th.