The hospitality industry on Friday hit out at minister Ram Vilas Paswan’s announcement that service charge was optional, warning that such statements could kill the booming industry. The statement comes close on the heels of a court ban on serving liquor near highways. Just last week, the minister spoke about a plan to regulate portion sizes though he later clarified that the steps would have to be voluntary.
“The government talked of ease of doing business but the question restaurant industry asking is, where is the guarantee of business,” fumes Riyaaz Amlani, president of National Restaurant Association of India (NRAI). NRAI is planning to hold nationwide protest against these guidelines. “The government did not talk of high taxes such as VAT, Swachh Bharat cess, Krishi Kalyan cess and service tax but talked only of service charge. Rather than clarifying that heavy taxes are resulting in inflated bills, the government is showing that restaurateurs are robbing people in the name of service charge when it is used for benefit of staff,” he elaborates.
After the minister’s initial announcement, restaurateurs TOI spoke with said there were already several instances of customers refusing to pay service charge stating their dissatisfaction with quality of services. While some simply waived off those charges, others held their ground and offered a discount equivalent to service charge rather than waiving it off.

Source: Times of India