Surcharge elimination at coffee giants
In a landmark change for coffee drinkers, the two largest coffee chains in the U.S., Starbucks and Dunkin', have both made the decision to end their long-standing surcharges for non-dairy milk options. For years, customers with dietary restrictions or preferences had to pay a premium to substitute plant-based alternatives for dairy milk. However, recent corporate decisions, influenced by legal challenges and consumer feedback, have put an end to this practice. Starbucks made its change effective in November 2024, while Dunkin' followed suit in March 2025.
Why the shift happened
Several factors contributed to the companies' decisions to drop the extra fees. A significant driving force was the series of class-action lawsuits filed against both chains. Plaintiffs in these suits alleged that charging more for non-dairy milk was discriminatory, particularly for individuals with lactose intolerance, which can be considered a disability under the Americans with Disabilities Act (ADA). Advocacy groups, including Switch4Good and Mercy For Animals, also played a crucial role by campaigning against the 'milk tax' and highlighting its impact on equity and sustainability. Additionally, the rising popularity of plant-based milks and changing consumer preferences signaled a clear market trend that coffee companies could no longer ignore. Starbucks CEO Brian Niccol acknowledged the importance of beverage customization, while Dunkin' noted that its policy change was guided by guest feedback.
Comparing the non-dairy surcharge policies
| Feature | Starbucks | Dunkin' |
|---|---|---|
| Surcharge Removed | Yes | Yes |
| Effective Date | November 7, 2024 | March 5, 2025 |
| Non-Dairy Options | Soy, Oat, Almond, Coconut | Soy, Oat, Almond, Coconut |
| Driving Factors | Lawsuits, activist pressure, consumer demand, new CEO strategy | Lawsuits, guest feedback, activist pressure |
| Market Impact | Led other chains to follow suit, ended 'milk tax' era among largest US chains | Put top 5 US coffee chains in line with each other on pricing |
Impact on customers and the industry
The end of the non-dairy surcharge is a victory for consumers, particularly for those with dietary restrictions or ethical preferences. It removes a financial barrier that disproportionately affected certain groups, as high rates of lactose intolerance are found among various demographics. The change also encourages more sustainable choices, as non-dairy milks generally have a lower environmental footprint than dairy products. For the industry, this signals a major shift in how major corporations respond to consumer advocacy and market demands. Smaller, independent coffee shops are now also under increased pressure to align their pricing or risk losing customers to the larger chains that have made plant-based milk the standard. This move marks a powerful precedent for fair and equitable pricing across the food and beverage sector.
List of reasons the surcharge was removed:
- Class-Action Lawsuits: Legal action claiming discrimination under the Americans with Disabilities Act played a critical role.
- Activist Campaigns: Advocacy groups like Switch4Good and Mercy For Animals pressured companies through public campaigns and shareholder proposals.
- Consumer Demand: The increasing popularity of plant-based milks made the surcharge unpopular and out of touch with market trends.
- Corporate Strategy: New leadership at Starbucks and a focus on guest feedback at Dunkin' provided the internal motivation for the change.
- Competitive Pressure: As one major chain made the move, others followed to remain competitive and meet customer expectations.
Conclusion
Both Dunkin' and Starbucks have successfully removed the surcharge for non-dairy milk options, a change that reflects significant shifts in consumer values, market trends, and corporate accountability. Effective in late 2024 for Starbucks and early 2025 for Dunkin', the decision stemmed from mounting public pressure, advocacy from non-dairy groups, and class-action lawsuits. This policy change makes plant-based alternatives more accessible and affordable, representing a major win for consumers and pushing the industry towards more equitable and sustainable practices. The end of the 'milk tax' at these coffee giants serves as a clear indicator that listening to consumer needs and ethical concerns is becoming standard business practice. You can read more about the impact of plant-based alternatives at the Switch4Good website: https://switch4good.org/.
