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Hotel service charge is optional (Relevant for GS prelims and Mains paper II)

The declaration by the government:
Consumer Affairs Department asked the States to advise hotels/restaurants to display that the service charges are discretionary/voluntary and a consumer dissatisfied with the services can have it waived.

Reasons behind the move:
There were several complaints that hotels and restaurants are charging service charge in the range of 5-20 per cent, in lieu of tips, which a consumer is forced to pay irrespective of the kind of service provided, the department said.

The Consumer Protection Act, 1986, provides that a trade practice which, for the purpose of promoting the sale, use or supply of any goods that adopts any deceptive method is to be treated as unfair.

What can the consumer do:
The department said a consumer can make a complaint to the appropriate forum established under the Act against such unfair trade practices.
It had called for a clarification from the Hotel Association of India, which said the service charge is discretionary and should a customer be dissatisfied with the dining experience, he/she can have it waived.



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