Customers usually check the prices mentioned on the Menu card while ordering. But while making the payment, they are asked to pay an amount which is significantly more than the prices mentioned. The difference is due to the statutory taxes/levies/cess which are supposed to go to the Government (I am not sure whether it does) and also those which go to the establishment (restaurant).
The restaurants may be asked to mention the actual price of a dish including taxes and other charges payable by the customer. How the establishment accounts/ computes the amount that is to go to the Government and to the establishment is a simple internal exercise (a software fix would do the job) with which the customers need not bother about.
Some restaurants levy a separate Service Charge which is normally about 10% of the prices mentioned. Is it the cost of Cooking? Waiting? Cleaning? Space? Air conditioning? etc etc. If payment of service charge (the new term for Tip) is compulsory and not a matter of choice, it should be included in the price of the dish. I wonder whether the amount collected is at all paid to the service staff or simply pocketed by the establishment!
A change in existing practice is called for in the best interest of Customers and also the Government more
The restaurants may be asked to mention the actual price of a dish including taxes and other charges payable by the customer. How the establishment accounts/ computes the amount that is to go to the Government and to the establishment is a simple internal exercise (a software fix would do the job) with which the customers need not bother about.
Some restaurants levy a separate Service Charge which is normally about 10% of the prices mentioned. Is it the cost of Cooking? Waiting? Cleaning? Space? Air conditioning? etc etc. If payment of service charge (the new term for Tip) is compulsory and not a matter of choice, it should be included in the price of the dish. I wonder whether the amount collected is at all paid to the service staff or simply pocketed by the establishment!
A change in existing practice is called for in the best interest of Customers and also the Government more
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I like to share what Little I learnt from taking my tourists to Restaurants. The terms Service charges, Service tax and VAT was all quiet confusing as there was no way to know information in the media. When we go to dine in a Restaurant we pay 2 taxes and 1 charge : They are : * Service Charges levied 5 to 10 % . This is for the services rendered by the Restaurant staff . ~ Restaurants usually levy 5% to 10% as service charge ~ The charge is collected from customers for services provided ~ If there is a service charge, it should be displayed; check the menu or ask ~ It is not necessary to tip if there is a service charge ** VAT [Value added Tax ]. This is a state subject it may vary from state marginally. It could vary from Product to product from 0 to 220 % .Alcohol having the highest VAT. In hotels it is 14.5 % *** Service tax :This is central Government tax [ See the model bill ] on all A/C Restaurants. From June the service tax is 15 % on 40 % of the value of food . An example of a Food Bill : Total food cost = 1,000 Service charges 5 to 10 % = 100 [no need to tip if 10 % is levied] Total = 1,100 VAT 14.5 % [June 2016]on 1,100 = 159.50. Service tax of 15% of the 40% [440] of the total bill [1,100] = 66 Grand Total = 1,325.50. So we pay around 32.55 % as taxes when we eat in an A/C RESTAURANT. IN STAR 4 & 5 HOTELS THE BASIC FOOD COST & SERVICECHARGES WILL BE MORE , SO THERE IS ALIKELY HOOD THAT IT MAY GO CLOSE TO 40 % more
Jul 17
In my opinion the menu card should mention on each page in bold letters " % of Service tax , VAT and Service Charges". So that a customer can understand what he / she is going to pay actually. Many resturaunts cheat unaware customers under the guise of " service charges" which varries from hotel to hotel and sometimes may go as high as 50% of actual charge. Either resturaunts owner should take initiative on their own or consumer forums should put pressure on govt. to take step to curb the over charging by resturaunts. more
Jul 16
Yes, I think it would be a good idea to ask the restaurant to state the total cost before taking orders. On 12 July 2016 at 08:32, Abhijit Lahiri wrote: > more
Jul 13
I do agree agree. The price should be displayed including all taxes etc. ( total amount to be paid ) more
Jul 13
