mid-day editorial: Clear the ambiguity about service charges

Of late, hotels and restaurants have found themselves at the centre of an imbroglio with the dominating question being to pay or not to pay service charge

Of late, hotels and restaurants have found themselves at the centre of an imbroglio with the dominating question being to pay or not to pay service charge. While service taxes are in compliance with government rules and regulations and are mandatory, for a few years now, eateries have been adding an extra “charge” to the consumer’s bill in lieu if their services. Usually, it’s 10 per cent of the bill amount, but it also often goes up to 20 per cent. Evidently, it’s a gray area and has led to plenty of confusion, debates and discussions in recent times.

Apparently, if you pay the service charge, you are not supposed to pay that customary “tip” to those who serve you at the restaurant. Yet, sometimes due to habit and at times out of gratitude, patrons continue to offer tips, after paying the service charge. Perhaps the need of the hour is to educate the masses about the difference between service tax and service charge and clear any confusion about the later.

The fact that service charge percentages vary from one food joint to another, however, must be checked. If a fixed percentage cannot be implemented, the range of the charge should be lowered. Restaurants should set a parameter for the charges, if they have to be imposed.

Ideally, though, a patron should be allowed to decide if the service was up to the mark and the service charge levied was justified. If the quality of service at a hotel was not satisfactory, it’s not fair to extort money from patrons under the pretext of service charges. Numerous skirmishes over these charges between diners and food joints have been reported. While the masses lose some money over this fracas, restaurants stand to lose some of their most loyal patrons as also their goodwill. Perhaps a solution to this mess needs to be found, sooner rather than later.

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