Is increasing your stuff's pricing and then slashing it for sale a crime in your country/area?

That happens all the time in my country.

That sounds really stupid, tbh. But hey, what do I know about running a business.

Happens all time with steam too. Game was 30 euros before winter sale, they they rose it to 50 euros just before the winter sale began. And the game was on top seller selling at something like 33 and something euros(before the daily deal). Many facepalms were had.

If it is advertised as lower, then yes.
Example, the star wars collection on Steam is advertised at 66% off. But it is actually 50% off. Now, they aren't actually advertising a price, but I think it may still be against trading standards.

I think it's illegal here...

Yes, yes it is.

Not as far as I know. And sellers like doing it all the time. As if the average markup of ~100% they get away with isn't enough...

enforced illegal contractual stuff

Quite the contrary. It is expected that all businesses do this. Xmas and other consumer holidays are quite prone to this tactic and unless you constantly watch the price through out the year, most people assume its a great deal.

In Australia it is illegal to advertise something as on sale if the price was raised in the previous week (maybe longer, I am not sure).
To claim a percentage off, it has to have been at the claimed "normal" price for a certain amount of time (again, unsure about how long).
A shop near where I work seems to have found a way around the laws though. They are having a closing down sale... for the past 5 years lol.

nothing wrong, it happens all the time IRL.

Yes, it's illegal here. A lot of digital stores did it on last black friday.