‘Service Charge’ In Hotel Bills Totally Voluntary: Govt Issues Guidelines

‘Service charge column of the bill may be left blank for the customer to fill up before making payment’

The Food and Consumer Affairs Ministry has made it clear that Service Charge on hotel and restaurant bills is totally voluntary and not mandatory, and Hotels/Restaurants cannot decide how much Service Charge is to be paid by the customer & it should be left to the discretion of customer.

The Department had issued guidelines in view of complaints that some hotels are insisting payment of service charge and many people are paying it under the mistaken notion that it is part of taxes. It says that the column of service charge in a bill will be left blank to customers to fill up before making the final payment.

The following is the gist of guidelines issued.

• Pricing of the product ordered from the hotel should cover both the goods and service components.


• Placing of an order by a customer only means he agreed to pay the prices displayed on the menu card with taxes and nothing more.


• Charging anything more in the name of 'service charge' would amount to unfair trade practice.


• Tips paid by a customer is a separate transaction between him and the hotel staff, and solely a discretion to be exercised by the customer

• Hotels cannot restrict entry of any customer for non-payment of service charge.


• Bill presented to customer may clearly display that service charge is voluntary and the service charge column of the bill may be left blank for the customer to fill up before making payment.


• If there is mandatory levy of service charge, customers can file a complaint in the consumer forums