Saturday, December 09, 2006

VAT. And Tipping.

I've been eating out a fair bit over the last couple of weeks and have started to notice something most incongruous, and ingenious, on bills that I've been presented at dining establishment across Bangalore.

But first, when I say VAT what number do you think of? 4%? 12.5%? Chances are, it'll be one of the two as it's the two most familiar numbers we have come to associate with the VAT charged in our fair Bangalore.

Now, think back to your last meal and recollect what the VAT component was. Did they charge you 4% VAT? Or 12.5 VAT? Or did they sneakily charge you a 12.5% "Service Charge"? The trouble is, if we see 12.5 on the bill and it's vaguely associated with the words Service or Tax or VAT or Charge we, subconsciously, write it off as a tax.

Today, after lunching at Tangerine, the bill showed a Service Charge of 12.5% and when I inquired, they stated that it was 4% VAT and and an 8.5% Service Charge. How bloody convenient. And now I'm left wondering how many restaurants pull this stunt with patrons being none the wiser.

And while on the subject of tipping, isn't it pathetic how badly Indians tip? There aren't too many people I know who decide the tip amount based on the bill value but rather on some perceived notions of charity and personal vanity. Leave 10%, at minimum and up to a maximum of 20%, if you're happy with the service calculated on the pre-tax amount.

Leave a comment. Let me know.

Update: MadMan points me to an old post of his where he states:
I also would like to mention that 80% of guests are unbelievably lousy tippers. The other 20% are the saving grace. When I see a Rs. 19 tip for a bill of Rs. 1581, I feel sad, even though I don't keep a cent for myself. Please be nice... tip in the region of 10% if the service was good. You will be remembered. Keep a cap of Rs. 200 if you want so you don't need to leave Rs. 500 for a bill of Rs. 5000.


jaKkUrXxXm29Luk4colegGrls/h0tAuntyZ said...

in some countries tips are considered part of wages, and waiters are not entitled to the same minimum wage as other vocations. their income is based on tips they receive directly, or that are pooled and redistributed. this is the system in NAmerica. tipping 20% of the bill elsewhere is pure unobligated generosity

MadMan said...

The standard VAT on food in a restaurant is 12.5%

That's it. There are no varying rates of VAT for this category.

Now, some restaurants charge VAT on their menu prices, while others list menu prices inclusive of VAT. The dude at Tangerine probably had no clue what he was talking about.

Some places also charge extra service charge on the bill (Take 5 is 10%, Ruby Tuesday is 12.5%, and Bamboo Shoots is 5%, just off the top of my head.) I don't like the idea of a service charge as it tends to make waiters - like at Sunny's - complacent.

blr bytes said...

In which case I stand corrected. So it's just plain old-fashioned incompetence.

As for tipping, Jakkur, I disagree. It's not like they get the best salaries and tipping, however generous it might seem, is one way to keep them on their toes.

MadMan, what you say?

karthik said...

The premium i pay for a plate of kebabs at anyplace takes into account things like the service amongst other things like ambience and quality of food. I think its unfair to pay a considerable premium and expect a tip also. If it comes ones way then good, but good service should not be meted out in the hope of a tip. That's akin to shirking responsibility on your job.

As for measures like 10% and 20% its upto anyone's discretion or vanity.

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