Gratuity tax?

[Rich_K0rz_nk0]

@Howard Horwitz

I understand taxing so-called mandatory gratuity but the restaurants really should not call it a gratuity if it is mandatory. How about “service charge”?

One would think that would be the easiest and most logical solution. Because that’s just what it is. Why make it less clear with euphemisms.

However… the industry hangs on to what it knows, what its comfortable with. Its muscle memory. Plus, as sure as I’m standing here some ass clown will pay the “service charge”, tack on 20% gratuity, then find out they over did it and feel “wronged”. Its a no-win situation.

I did love my time in Europe for its simplicity on this matter.

[Al_Osterheld]

California requires restaurants to pay tipped staff the minimum wage, with no credit for tips. The minimum wage varies by location, that that requirement does not.

-Al

[Scott_G_r_u_n_e_r]

@JulianD

@alan weinberg

what irritates me is the “x% added for employee health care.” Add it to the cost of food and pay the employees’ benefits yourself. Let me then decide if I want to order the item. Just grates on me.

This. I mean… shouldn’t you factor in your costs to your products? Nope, just gonna add it later.

Read your cell phone bill lately? They pioneered this practice of passing on random taxes or just costs of doing business as additional taxes to “avoid” raising prices

[Kelly_Walker]

My Palm Beach rental car this week:

Quoted: $54.36

Service Charges:
Concession Recoupment Fee: $6.38
Vehicle Licensing Cost Recovery: $1.41
Frequent Flyer Surcharge: $0.07
FLA Surcharge: $6.06
Energy Surcharge: $1.49
Tax: $4.88

Total actually paid: $74.57

[RichardFlack]

@J. Galang

Personally I have never been a fan of tipping, in any situation. There is a restaurant in Oakland called Camino where they got rid of tips. Obviously the food prices got higher but in the end I actually preferred that to the concept of tipping. IMHO tipping is bad for waiters and staff in general because it gives the restaurant the justification to pay their employees below minimum wage (or a very low salary) in most places.

It was actually quite a refreshing change when I last dined at Camino:

http://www.caminorestaurant.com/about

I wish ALL restaurants followed this model (I guess I could always move to Japan )

And presumably tax is levied on the total price? Not total less 20% deemed tip?

I’m curious how Tax is handled at any “pay what you can” facility (thinking of some theatres say). Are they required to charge tax. I’m guessing yes. Really if you accept the premise of sakes and service or value added tax it’s a bit of an anomaly that tips are not all taxed. (As all tips are theoretically subject to income tax).
It’s a funny business model. Imagine a car repair shop paying minimum wage and relying on tips…
But then there’s a lot that’s funny about the restaurant business e.g. Under charging for food and over charging on wine. But that’s another thread I think.

[JulianD]

@Scott G r u n e r

@JulianD

@alan weinberg

what irritates me is the “x% added for employee health care.” Add it to the cost of food and pay the employees’ benefits yourself. Let me then decide if I want to order the item. Just grates on me.

This. I mean… shouldn’t you factor in your costs to your products? Nope, just gonna add it later.

Read your cell phone bill lately? They pioneered this practice of passing on random taxes or just costs of doing business as additional taxes to “avoid” raising prices

Things being common in the wireless indsutry <> things being common in the restaurant industry.