State Tech Pulse Policy Brief: 5 States Pass New Laws on Algorithm-Driven Price Setting
States are increasingly looking at how companies are using customer data to set prices and are putting new consumer protections in place, alongside consumer privacy laws.
One Harvard scholar notes that companies using data to determine prices isn’t new, it is up to us on what data we are comfortable with. Two examples the researcher points to show the range of circumstances where this can happen.
1st Example: Airlines use data and algorithms to set prices based on data points like weather, what competitors are charging, and demand.
2nd Example: An SAT tutoring company was charging higher prices on zip codes based on race.
Additional background: The Federal Trade Commission (FTC) released a report in 2025 that investigated how companies use consumers' personal data, like location and browsing history, to set individualized prices. This study aimed to help the FTC better understand how, “the opaque market for products by third-party intermediaries that claim to use advanced algorithms, artificial intelligence and other technologies with personal information about consumers ... to categorize individuals and set a targeted price for a product or service.”
How have policymakers responded?
Federal: No federal regulations are currently in place putting guardrails between consumer data and setting prices for everything from housing to consumer goods.
States: State legislators in five states passed new laws for algorithm-driven price-setting, with one state’s CEO stepping in to halt a new law from being inked.
New York: Over the past two years, New York has led the conversation around regulating data-driven pricing. In 2025, New York (SB 7033) became one of the states to put guardrails around how companies use data to set prices on consumer goods. The new law requires disclosures when prices are based on personal data. The law prohibits price differences based on location and prohibits the use of protected class data in setting prices. This year, New York state legislators continued this work by approving changes (AB 9349) to adjust the new law and the bill is now awaiting approval from the Governor. If approved, some of the new changes include:
Clarifying that data collected by transportation, delivery and logistics companies to calculate cost based on mileage and trip duration does not fall under “personal data.”
Removes the requirement to disclose that a price was set using personal data to prohibiting "surveillance pricing,” which is using an algorithm that uses personal data to offer different prices to different customers for the same good or service.
Another proposal legislators passed that is awaiting the Governor’s signature (SB 7882) in New York prohibits residential property owners from coordinating prices through an “algorithmic device.”
Maryland: In 2026, more states considered these types of measures. Maryland passed a new law (HB 895) that prohibits a food retailer or third-party delivery service from using personal data to set higher prices for specific consumers and items. Similar to movement in New York, the law clarifies that price-setting based on factors such as supply and demand of specific items do not apply. The law states that this new prohibition does not apply to promotions, discounts and loyalty programs, which is a reason Colorado’s Governor vetoed a similar measure.
Colorado: Earlier this month, Colorado passed a bill (HB 1210) that the Governor ended up vetoing, which would have prohibited companies from using consumer data to generate individualized prices and basing compensation and wages on an algorithm.
Connecticut: Also, this month, Connecticut's Governor signed a law (HB 5563) that prohibits retailers from using personally identifiable data to customize prices for shoppers.
California: Less than a year ago, California passed a new law (SB 325) that expands the state’s antitrust law to prohibit companies from working together to coordinate prices based on algorithms.
Are there other sectors/industries lawmakers are looking at related to this topic?
Around 7 states introduced legislation this year focused on data-driven pricing for food.
About 9 states introduced legislation this year focused on rental housing pricing from algorithms.
Over 15 states introduced legislation this year focused on the broad use of algorithms for pricing consumer goods.
A few outlier states introduced legislation on this topic related to specific sectors such as entertainment and healthcare.
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