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Should a tip or service charge be voluntary or compulsory?
JP/Arief SuhardimanRecently, Rudianto, a Jakartan, had dinner and some drinks with his three friends at a café in Central Park, West Jakarta
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JP/Arief Suhardiman
Recently, Rudianto, a Jakartan, had dinner and some drinks with his three friends at a café in Central Park, West Jakarta. He was shocked to see the bill, which contained a 20 percent additional charge on top of the value of the food and drinks they had ordered.
They consumed Rp 400,000 worth of food and drinks but Rudianta had to pay a service charge of Rp 40,000 (10 percent) and another Rp 44,000 as PB1 tax (Development Tax 1). The total came to Rp 484,000. Therefore, in order to spend Rp 400,000, he had to pay an additional Rp 84,000.
But the tricky part is that as per the government rule people must pay 10 percent tax on every purchase of food and drink at a restaurant or bar.
“The PB1 tax should have been Rp 40,000 or 10 percent of the total cost. I was informed by the manager that it is a government procedure that every restaurant add a service charge to the actual bill and then charge 10 percent tax to that amount,” Rudi told The Jakarta Post recently.
But there is no regulation, which says every customer must pay a service charge. One may ask why a customer must pay a fee for services at a restaurant to the government. Normally, a restaurant includes all costs when determining the price of its products.
Sandra Dewi, a university student, had to pay a 6 percent service fee and 10 percent tax when having dinner at a vegetarian restaurant at Central Park.
The individual restaurant or café decides how much a customer must pay as a service charge, depending on their location, facilities and the quality of service. There is no uniformity or any standard for service charges in Indonesia.
The famous Pizza Hut’s PHD, a pizza delivery company, does not charge for its services for purchases from its outlets. It charges only the 10 percent government tax.
Fajar Cahayono had another unique experience.
He went to a restaurant in West Jakarta and ordered a plate of fried rice and told the waiter to pack it. The restaurant charged him the 10 percent government tax and a 5 percent service charge.
“I protested strongly to the manager about the service charge. Because I didn’t eat there and there was no service at all. Why should I pay a service charge for service I didn’t receive?” Fajar said.
But the restaurant insisted that all food sold from restaurant must be sold with an added service charge.
Is it compulsory for customers to pay a service charge?
What happens if the service is very bad and the restaurant is not clean? We still have to pay a fee for bad service.
Not only that, but at some bars and karaokes there is also an exorbitant fee in the form of a tip.
For example, a karaoke venue in West Jakarta tells its customers that they should give a Rp 500,000 tip for every six-hour session. Some local massage and spa parlors have a fixed tip.
Service charges, in fact, are already a tip to waiters. It has a more than 300 years history. The word tip is an abbreviation from “to insure promptitude,” which was a common practice at bars in England in the 17th century.
Tipping is a common practice in many countries. But there are certain countries where tipping is rarely practiced. Normally, South Korean employees would be offended if you give a tip. Their argument is that when a customer pays for their food, it includes everything so there is no need to pay a service charge or give a tip. The Japanese are the same. Tipping is not part of Japanese culture, although some outlets nowadays put a tip box near the cashier.
As far as Indonesia is concerned, there is only one regulation regarding service charges so far. Manpower Minister issued the Ministry Regulation No. PER-02/MEN/1999 regarding the distribution of service charges to the employees of hotels, restaurants and other tourist facilities.
The regulation stipulates that the owners of these establishments must give service charge earnings to their employees. The owners are permitted to use a small amount of the money (up to 10 percent) for employee training to improve the quality of service.
It is a well-known fact that many restaurants and bars do not give the proper amount from the service charge to their employees. Some pay the full amount while others pay only a small portion to their employees. Some outlets even feel the service charge is meant for themselves not for employees and do not pay a single cent to their employees.
But nowhere does the government say that it is compulsory for a customer to pay a service charge and how much the charge should be.
Some countries like India are considering regulating service charges by giving a right to customers to decide whether they want to pay a service charge or not.
In Indonesia’s case, there is a need to regulate service charges by imposing a standard tax for all food outlets. Some people also criticize the Indonesian Consumer Foundation (YLKI) on this issue.
“I never see any concern from YLKI, which is supposed to fight for consumer rights. It should demand a voluntary service charge at restaurants and bars,” a Palmerah resident said while refusing to give his name.
It may be true that if a customer is not satisfied with the service, there should be no obligation for him or her to pay a service charge. Not all customers are bad, some are very generous.
“I know some customers who are very generous toward waiters and waitresses. Besides paying a 20 percent tax and service charge on top of their bill, they still give a tip to the restaurant staff,” Mega, a waitress at a popular café said.
