CONRAD DIAS
Ranchi, July 5: Hotel and restaurant service charges cannot be added to invoices now, according to the Central Consumer Protection Authority (CCPA), India’s consumer protection agency’s order.
The order was released on Monday. The decision to impose the restriction, according to the authority, was made in response to an increase in customer complaints about having to pay the service fee.
However, many restaurant owners across the city are unhappy with the decision. The hotel and restaurant representatives have stated that the imposition of service charges is a matter of individual policy and that there is no illegality in levying such a charge. Additionally, they were in favour of service fees, arguing that they would benefit the government and that taxes should be paid on them.
A list of updated rules in this regard has been published by CCPA. The customer’s decision to pay the fee or a gratuity is entirely optional; neither action may be required of them. The department of consumer affairs (DMCA) had stated that it will soon create a framework to ensure regulation of service charges and ensure that customers do not encounter any issues with the same.
On the flip side, customers from across the city are happy with the government’s decision. There is a hope that maybe now the customers can dine in without any problems and can enjoy themselves without worrying about the service charge.
Rohan Kumar, a resident of Ranchi said that now visiting a good restaurant for lunch or dinner with the family will hopefully not take a toll on his pocket as the rates on the menu have anyway gone high after Covid.
“It is a positive decision that has been taken. After the pandemic visiting a good restaurant with family seem like an expensive deal but with the removal of the service charge it will bring at least some relief,” he said.
After the pandemic, many new restaurants have come up in the city and these business owners believe that the decision to remove the service charge will eventually make them increase the salary of their staff.
“Service charge is usually charged because of various factors such as ambiance of the restaurant, services provided such as AC and others. If we don’t charge service tax then we will have to increase the rate of the dishes which is not a good idea as per a business person,” said Nishant, a restaurant owner from Ranchi.
The guidelines have been issued by CCPA under Section 18 (2) (I) of The Consumer Protection Act, 2019. These are in addition to the 2017 guidelines by the government, which announced that service charge is completely voluntarily.
