Restaurant Tips & Taxes... one more time

**RT Gooch** · #1 (**permalink**) 19/05/08, 14:01:34

Good afternoon. RT here. I know that we covered this once before, but I am still confused.

It was my understanding that the prices on the menus in restaurants was inclusive of taxes and a 10% tip, and then it was up to your discretion whether or not to leave an additional propina.

I was in an excellent restaurant Saturday night (review to follow). The menu said that the prices included taxes (IGV) and 'servicio'. Then the check came. It was (as expected) for 199.20 Soles.

It first listed the items with the menu prices. So far, so good.

Then, the following:
SUBTOTAL...........160.65
DSCTO.................... 0.00
I.G.V...................... 30.51
% SERVICIO............ 8.04

TOTAL S/. ..........199.20

I get the IGV, that's 19%. But the 'servicio' was only 5%, not 10%.

I paid with a credit card and added another 15 Soles to the price before I looked at the Boleta detail. Once I saw the detail, I was confused. I spoke with the hostess (perfect English; no language barrier there), she said that the 5% was a tax and not the tip. The meal and service were superb, so I gave her another 20 Soles and asked her to give it to the waiter and explain our confusion.

I'm not all that concerned about the extra tip, as much as I am bothered that I may still not understand this system. Can someone please help with an explanation?

Thanks.

**RT Gooch** · #2 (**permalink**) 19/05/08, 14:19:31

Jeepers, it gets worse. I'm going through all of my receipts now.

So I take these two young ladies to this wonderful Italian restaurant that was recommended to me by Homo_Lo_Gato. Dinner was fine, and he was right to recommend it.

Here's the details on their receipt:

TARJETAS..........136.50
VALOR VTA. .......114.71
I.G.V. 19%.............21.79

If I read this right, then NO tip was included. If so, I can't show my face around there again, because I only added a small amount to the credit card bill.

Help help help help.

**gunslinger** · #3 (**permalink**) 19/05/08, 14:21:14

Hi RT,

Let me check with my accountant on this one, and get back to you with an answer.

Regards,

Gunslinger

Cita:

Iniciado por RT Gooch

Good afternoon. RT here. I know that we covered this once before, but I am still confused.

It was my understanding that the prices on the menus in restaurants was inclusive of taxes and a 10% tip, and then it was up to your discretion whether or not to leave an additional propina.

I was in an excellent restaurant Saturday night (review to follow). The menu said that the prices included taxes (IGV) and 'servicio'. Then the check came. It was (as expected) for 199.20 Soles.

It first listed the items with the menu prices. So far, so good.

Then, the following:
SUBTOTAL...........160.65
DSCTO.................... 0.00
I.G.V...................... 30.51
% SERVICIO............ 8.04

TOTAL S/. ..........199.20

I get the IGV, that's 19%. But the 'servicio' was only 5%, not 10%.

I paid with a credit card and added another 15 Soles to the price before I looked at the Boleta detail. Once I saw the detail, I was confused. I spoke with the hostess (perfect English; no language barrier there), she said that the 5% was a tax and not the tip. The meal and service were superb, so I gave her another 20 Soles and asked her to give it to the waiter and explain our confusion.

I'm not all that concerned about the extra tip, as much as I am bothered that I may still not understand this system. Can someone please help with an explanation?

Thanks.

**Homo_Lo_Gato** · #4 (**permalink**) 20/05/08, 13:33:27

Cita:

Iniciado por RT Gooch

Good afternoon. RT here. I know that we covered this once before, but I am still confused.

It was my understanding that the prices on the menus in restaurants was inclusive of taxes and a 10% tip, and then it was up to your discretion whether or not to leave an additional propina.

As far as I know, the law requires the menus in restaurants to be inclusive of taxes and also of service when applicable. However, it must be remembered that not all restaurants are required to include "servicio" in their bills but, those which are, are required to mention it on the menu as a footnote; so you have to look for it in the menu if you want to know whether "servicio" is included or not. Small restaurants are not required to charge for "servicio" so the tip you give to the waiter is all the tip they get.

Cita:

I was in an excellent restaurant Saturday night (review to follow). The menu said that the prices included taxes (IGV) and 'servicio'. Then the check came. It was (as expected) for 199.20 Soles.

It first listed the items with the menu prices. So far, so good.

Then, the following:
SUBTOTAL...........160.65
DSCTO.................... 0.00
I.G.V...................... 30.51
% SERVICIO............ 8.04

TOTAL S/. ..........199.20

I get the IGV, that's 19%. But the 'servicio' was only 5%, not 10%.

I paid with a credit card and added another 15 Soles to the price before I looked at the Boleta detail. Once I saw the detail, I was confused. I spoke with the hostess (perfect English; no language barrier there), she said that the 5% was a tax and not the tip. The meal and service were superb, so I gave her another 20 Soles and asked her to give it to the waiter and explain our confusion.

The "servicio" is not a tax, in the sense that no part of it goes to the SUNAT (peruvian IRS) but, since it is mandatory by law, most of them refer to it as "a tax". Also I take it that not all the personnel receives a cut from that mandatory "servicio" (p.e. I believe the hostess doesn't) and I am certain that those who do don't collect it at the end of the day but on payday; however, all tips collected in cash are usually put in a common pot and distributed at the end of every shift, so they will always try to get some "extra" tip in that pot.

As for the 5% rate, it is a surprise for me too, I'll have to investigate the matter. Maybe it depends on the rating of the restaurant. Restaurants are rated just as hotels are (one star, two stars... five stars) although I believe they are no rated in "stars" but in "forks". I am not sure about that last detail but that they are rated... they are rated.

Cita:

Iniciado por RT Gooch

Jeepers, it gets worse. I'm going through all of my receipts now.

So I take these two young ladies to this wonderful Italian restaurant that was recommended to me by Homo_Lo_Gato. Dinner was fine, and he was right to recommend it.

Here's the details on their receipt:

TARJETAS..........136.50
VALOR VTA. .......114.71
I.G.V. 19%.............21.79

If I read this right, then NO tip was included. If so, I can't show my face around there again, because I only added a small amount to the credit card bill.

Help help help help.

Well... I assume you are speaking of El Italiano in Santa Catalina. If so, you are right; they are not rated high enough to include "servicio" in the bill. Which is proof (if proof was ever needed) that the best food is not necessarily found in the most expensive and high rated places. El Italiano falls in the category of "hueco"; that is, an excellent food, atmosphere and attention, in a little known place out of the tourist circuit... for those "in the know".

However I don't think you should worry about tipping too low. They are not so much used to the "american" idea of a reasonable tip but to the "peruvian" tipping customs; so I am pretty sure that your "small amount" has been well received. I did much worse: last thursday I went to this beautiful restaurant in Little Italy (NYC), had a superb dinner for two, paid with my credit card... and totally forgot to tip; it is fortunate that I am not going back to NYC anytime soon.

A piece of advice, though: in places that do not charge "servicio" (I am talking Peru now) it is best to tip in cash, the waiters will be happier with a small or regular tip in cash than with a more generous one in plastic.

**gunslinger** · #5 (**permalink**) 23/05/08, 20:47:52

Hey RT,

After HLG thorough reply, my accountant's report falls short, even looks ludicrous.

Anyway, I'm always around, eager to help out.

Gunslinger

Zizu · #6 (**permalink**) 23/05/08, 21:57:03

Hello my friends well seems that my experience can be helpful in this one....i was a maitre d in a restaurant overseas for almost 5 years so here we go......ok guys just one tip for all of you, when the service is included in the bill and this is only 5% or sometimes 10% do not ask the host or the waiter if this means the tip is included beacuse most of them will tell you that is just an extra tax or a restaurant tax, beacuse they all expect at least 15% of the bill amount as a tip so they will do anything to get that amount from you...even if this means lie to you to get the extra tip, this happens in the USA, mexico and of course in Peru too....these are the places where i worked and i learn this stuff when i was just a waiter....so guys be aware when servicio is included in your bill, that means the tip is there....but if is only 5% of course the waiter or the hostes will try to get more from you in case you ask...so play it simple if you beleive that they deserve it and 5% is not enough just give extra tip, if not just leave it there but never and i repeat never!!!!!! ask your waiter or the host if the tip is included, they will play smart on you guys....ok? so you are all warned now!!! hope this was helpful....and any other tip like these just ask me.....saludos

**RT Gooch** · #7 (**permalink**) 23/05/08, 23:25:50

RT here. Thanks for the answers...

Cita:

Iniciado por Homo_Lo_Gato

As for the 5% rate, it is a surprise for me too, I'll have to investigate the matter. Maybe it depends on the rating of the restaurant. Restaurants are rated just as hotels are (one star, two stars... five stars) although I believe they are no rated in "stars" but in "forks". I am not sure about that last detail but that they are rated... they are rated.

Well, this joint would have been six stars (or forks or whatever) out of five. I don't remember the name right now -- I will PM it to you.

Cita:

Iniciado por Homo_Lo_Gato

Well... I assume you are speaking of El Italiano in Santa Catalina. If so, you are right; they are not rated high enough to include "servicio" in the bill. Which is proof (if proof was ever needed) that the best food is not necessarily found in the most expensive and high rated places. El Italiano falls in the category of "hueco"; that is, an excellent food, atmosphere and attention, in a little known place out of the tourist circuit... for those "in the know".

However I don't think you should worry about tipping too low. They are not so much used to the "american" idea of a reasonable tip but to the "peruvian" tipping customs; so I am pretty sure that your "small amount" has been well received.

I think that I left ten soles additional on the credit card. Right you were about the restaurant.

Cita:

Iniciado por Homo_Lo_Gato

A piece of advice, though: in places that do not charge "servicio" (I am talking Peru now) it is best to tip in cash, the waiters will be happier with a small or regular tip in cash than with a more generous one in plastic.

Duly noted, and an excellent suggestion. From now on, cash it is.

PS - When I go to New York, I will deny all knowledge of you. You should be safe.