Don’t you sometimes feel like, “Man, if I had a dollar for every time I felt like I was being extorted for the amount of service charge I was being asked to pay up at hotels and restaurants, I’d be a millionaire”? Well, good news, you can stop feeling like that. The next time you go to a restaurant, or hotel for that matter, for nice night out, or a fancy lunch, be sure to check your bill at the time of paying up. And if you’ve been charged under the bracket of Service Charge, you should either take it up with the management and get it waived off, or if they insist, take them to Consumer Court. 

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According to a recent ruling, it is no longer mandatory to pay for Service Taxes at hotels and restaurants. In fact, all F&B venues are supposed to leave the space under Service Taxes blank from now on, to be filled up by the customers, based on whether or not the services were exemplary and they feel like they would like to volunteer for a small tip towards Service Charges. This means that it is now only voluntary for you to pay service charges, if you want. It is not a mandate. 

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Ram Vilas Paswan, Union Minister for Consumer Affairs, announced that service charge on hotel and restaurant bills is “totally voluntary” and not mandatory especially since the government has now approved guidelines on service charge. He went on to say, in a series of tweets on his official Twitter handle, “Hotels/Restaurants should not decide how much service charge is to be paid by customer and it should be left to discretion of customer. Government has approved guidelines on Service Charge. Service Charge is totally voluntary and not mandatory now.” 

 

Government has approved guidelines on Service Charge.

— Ram Vilas Paswan (@irvpaswan) April 21, 2017

 

 

 

As per guidelines Service Charge is totally voluntary and not mandatory now.

— Ram Vilas Paswan (@irvpaswan) April 21, 2017

 

 

Hotels/Restaurants should not decide how much Service Charge is to be paid by the customer &it should be left to the discretion of customer.

— Ram Vilas Paswan (@irvpaswan) April 21, 2017

 

 

Guidelines are being sent to states for necessary action at their ends.

— Ram Vilas Paswan (@irvpaswan) April 21, 2017

 

Paswan has assured that the latest guidelines are already on their way to the states to make way for necessary implementation of the rule. 

A senior Consumer Affairs Ministry official confirmed the news and told PTI, “If there is mandatory levy of service charge, customers can file a complaint in the Consumer Court.” The official also added that while heavy duty fines and strict action against violation cannot be taken at the moment because the current Consumer Protection Law does not empower the ministry to do so, the new Consumer Protection Bill, under which an authority will be set up, will have powers to take the necessary action.  

Fio Cookhouse & Bar

The advisory bill, Paswan said last week, had been prepared and sent to the PMO for approvals. In the bill, Paswan had reinstated his comments; “Service charge does not exist. It is being wrongly charged. We have prepared an advisory on this issue. We have sent it to the PMO for approval.” The ministry had also recorded a number of complaints from consumers, stating that a service charge in the bracket of 5-20% had been charged by restaurants and hotels in the past. 

Well, we can bid goodbye to this random act of extortion at hotels and restaurants now and enjoy our meal without worrying about why a service charge should even be implemented. By the way, where are you dining this weekend?