The Department of Consumer Affairs restricted restaurants from levying service charges.
The government has spoken: The bill might look a little different next time you’re dining out. It may not have service charges. The Department of Consumer Affairs said restaurants can’t levy service charges and said it’s illegal.
- For consumers, it’s a boon. If they haven’t had a good experience, some may not feel right about paying a service charge. Some customers think paying a service charge should be a choice, not mandatory.
- For restaurants, it’s terrible news. Removing service charges will impact the staff since the amount usually goes to them. Some establishments might have to pay out of their own pocket. They also can’t cut down on staff.
NRAI outraged: The National Restaurants Association of India said levying service charge isn’t an unfair trade practice. It’s the norm in several other countries. To counter this regulation, some restaurants might increase food items’ prices.