With expectations that prices will rise throughout the economy over the summer as more tariffs stack up, a group of legislators on Capitol Hill, highlighted by Senator Elizabeth Warren (D-Mass.), introduced a bill to target price gouging by the market’s biggest companies.
The Price Gouging Prevention Act of 2025 — introduced on Thursday by Warren along with Senator Tammy Baldwin (D-Wisc.), Rep. Jan Schakowsky (D-Illinois), and Rep. Chris Deluzio (D-Pa.) — would make price gouging illegal and give the Federal Trade Commission and state attorneys general the power to litigate alleged abuses of market power.
The proposed legislation comes just days after the June consumer price index showed a resurgence of inflation and as the tariffs toll continues to grow.
Warren says that in the past, big corporations have taken advantage of market shocks, hiding behind factors like inflation and supply chain disruptions to raise prices excessively, but this time the culprit is President Trump’s global trade war.
“Donald Trump’s reckless tariff policies are giving companies cover to squeeze families and raise prices more than necessary. My bill is an opportunity for Congress to stand up for families by cracking down on price gouging and fighting back against corporate abuse,” Warren said in a statement.
The text of the bill, as seen by CNBC, lists “abrupt trade policies” and “exceptional market shock” as factors to be considered in analysis of price increases.
A version of the bill introduced last year, The Price Gouging Prevention Act of 2024, did not specify trade policies. That legislation, sponsored by Warren along with former Senator Bob Casey (D-Pa.) was introduced in February 2024, but failed to pass. Casey lost his Senate seat in the 2024 election to Republican David McCormick.
The price gouging bill would require companies with over $100 million in revenue to publicly report in Securities and Exchange Commission filings on any changes in pricing that exceed the average price in the past 120 days before the reporting period, and provide details on product costs and margins. Businesses with less than $100 million in revenue would be protected from price gouging litigation if they show legitimate cost increases.
The bill would allocate an additional $1 billion in funding to the Federal Trade Commission to enforce the price gouging law.
“The biggest corporations in our country jack up the cost of everyday household items, take in record profits, and give their executives huge bonuses – all on the backs of hard-working Wisconsin families,” said Senator Baldwin in a statement. “Donald Trump claimed he would lower prices – so far, he has done just the opposite and is even opening the door to more price gouging. … Our bill will finally crack down on corporate greed and help stop those big companies at the top of the food chain from sticking families with exorbitant costs,” she stated.
In second-quarter earnings calls, companies from Costco to Best Buy and Newell Brands cited tariffs as a reason for price increases. Many companies, including Levi Strauss, have indicated that price increases related to tariffs will not be uniform across product lineups, and some costs will be absorbed rather than passed along. But most companies do expect pricing to move higher over the summer as more layers of tariffs from around the world are added, a position that Federal Reserve has also stated as its view.
Fed Chair Jay Powell said at the June FOMC press conference, “Everyone that I know is forecasting a meaningful increase in inflation in coming months from tariffs because someone has to pay for the tariffs. It will be someone in that chain that I mentioned, between the manufacturer, the exporter, the importer, the retailer, ultimately somebody putting it into a good of some kind or just the consumer buying it. All through that chain, people will be trying not to be the ones who can take up the cost but ultimately, the cost of the tariff has to be paid. And some of it will fall on the end consumer.”
Gina Sanchez, chief market strategist at wealth advisory firm Lido Advisors said this kind of law could help to curb runaway inflation, which she believes is potentially on the horizon. “We are seeing impacts of tariffs at the margins and we have yet to see the impacts in service industries that are dependent on migrant labor like construction, agriculture and restaurants, as an example,” said Sanchez. But given that the current administration is unlikely to support Democratic Party policy ideas, “I don’t hold out much anticipation of it’s passage,” she said. “It has an uphill climb to make it into law having only been introduced and referred to committee. Beyond partisan politics, this bill will almost certainly face industry opposition, who will almost certainly lobby against the strong regulatory and disclosure requirements,” she added.
Deluzio said price increases are a result of “out-of-control” corporate power. “Prices are still too high, and inflation is still pounding folks,” Deluzio said in a statement. “Especially now, we need to rein in monopolists and other huge corporations with the power to price-gouge the American people,” he added.
The AFL-CIO and United Steelworkers both voiced support for the bill and told CNBC that the bill is long overdue.
Price gouging policy ideas have been criticized on both the right and left in recent history. During Kamala Harris’s run for the presidency, Obama economic advisor Jason Furman told the New York Times that a plan to ban grocery store “price gouging” was not sound economics. “This is not sensible policy, and I think the biggest hope is that it ends up being a lot of rhetoric and no reality,” he told the Times. “There’s no upside here, and there is some downside.”
During a heated CNBC interview in August 2024 about the same Harris plan, Warren said three dozen states, including Florida and Texas, already have price gouging laws and have used them effectively. These state laws are often focused on natural disaster scenarios and acute shortages of goods and services.
“Pricing gouging laws are not price controls. Price gouging laws are there to say that sometimes markets go off the rails and when they do we need some ways to get them back on the rails. We need some curbs on that behavior,” Warren said during the August 2024 “Squawk Box” interview.
The issue has been a long-time focus for Warren, who, along with Casey, sent a letter to Kroger CEO Rodney McMullen in August 2024 questioning the grocer’s rollout of electronic shelf labels, arguing the technology could make it easier to increase prices of high-demand items.
In separate price gouging accusation last November in the days leading up to the election, Warren, along with Sen. Adam Schiff (D-Calif.), sent a letter to the Federal Trade Commission and the Department of Agriculture calling on the agencies to investigate Albertsons and its subsidiaries Safeway and Vons for mislabeling items sold by weight, including produce, meat and baked goods and unlawfully charging customers prices higher than their lowest advertised or posted price. A month prior, Safeway, Albertsons, and Von paid nearly $4 million to resolve allegations of price gouging and false weight advertising in California.
Co-sponsors of the new bill include Senators Richard Blumenthal (D-Conn.), John Fetterman (D-Pa.), Andy Kim (D-N.J.), Ed Markey (D-Mass.), Jeff Merkley (D-Oregon.), Bernie Sanders (I-Vt.), Elissa Slotkin (D-Mich.), and Sheldon Whitehouse (D-R.I.). In the House, sponsors include Representatives Angie Craig (D-Minn.), Maggie Goodlander (D-N.H.), Hank Johnson (D-Ga.), Ro Khanna (D-Calif.), Eleanor Holmes Norton (D-D.C.), Jerry Nadler (D-N.Y.), Mary Gay Scanlon (D-Pa.), Rashida Tlaib (D-Mich.), and Paul Tonko (D-N.Y.).
Zephyr Teachout, a Fordham Law professor and antitrust expert who has run for office in New York State, called it a “very common sense piece of legislation,” and said it is in line with the state price gouging laws around the country.
“One way to understand price gouging is that it’s poor man’s antitrust,” Teachout said. “We’ve allowed so much market concentration that the goliaths can just use market shocks to hike up prices, and exploit the lack of competition to gouge customers. That shows up as Warren and others note in the big profit hikes that keep happening after disasters and other market shocks. This bill is a really important corrective,” she said.
In an interview on CNBC’s “Squawk Box” on Thursday morning before the bill was introduced, Warren weighed in on several other big topics in politics, including Trump’s attacks on Federal Reserve Chair Jay Powell and the New York mayoral race, explaining her support for the policies that Democratic Party candidate Zohran Mamdani ran on.
