The Albanese government introduced laws to parliament on Wednesday to put an end to tactics used by businesses that cost people time and money, as the rising prices sting households.
Subscription traps is a deceptive practice where companies make it easy to sign up for a service, but difficult to cancel.Â
This leads to unwanted payments being made by consumers who are often required to jump through many hoops.
Drip pricing is when a low price is initially advertised but ends up being more expensive once mandatory fees and taxes are applied at the check out.
Assistant Competition Minister Andrew Leigh said the measures will be actively policed by Australia's consumer watchdog, as well as state and territory regulators.
While it will still be at least a month until the legislation passes, he hoped businesses would be proactive and implement the reforms ahead of the laws coming into effect.
"There will be a lot of cops on the beat making sure that firms are doing the right thing," he told reporters in Canberra.
"The expectation starts from today that firms will be complying with these new rules."
Dr Leigh said the rules were backed by tough penalties, with the maximum being 10 times higher than it was when Labor came to office in 2022.
Consumer Policy Research Centre chief executive Erin Turner said subscription traps had caught three in four Australians.
"The laws introduced today mean that we can trust that businesses will treat us fairly, or that they're going to face significant and meaningful penalties if they do the wrong thing," she said.
"We know unfair business practice bans work. We've seen them work internationally."
The legislation is part of wider reforms introduced by the government to crackdown on anti-competitive behaviour and support consumers.
These include increasing penalties to $100 million if businesses are found in breach of consumer and competition law.
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