Tipping Practice Questions- On Tax and on Discounted Meals [moved from Manhattan]

[jen_om]

Two protocol questions for the Chowhounds out there...

First, do you tip on the after-tax amount or the before-tax amount?

Second, when dining out using a discount deal from Blackboard Eats or alike (e.g. 30% off your meal) do you tip based on the non-discounted price or based on the discounted price?

I appreciate that waitstaff needs and deserves to be paid. I respect that and am generally a 20% tipper given decent food and service however; I also think in the case of tax that it isn't a "service" so why should I pay extra for it and in the case of discounted deals that the restaurant has already decided to discount its service likely because they believe doing so will increase traffic, and in this case they're right because that's why I'm eating there... so presumably it's a win on all sides- for the diner, the staff and the restaurant- so shouldn't all sides receive the same level of benefit?

[tommy]

I try to tip as little as possible, so I tip 15% on the pre-tax total.

[thew]

from what little i know of you, this does not surprise me.

[menton1]

If you try to tip "as little as possible", why not 5 or 10%? Doesn't make sense... Although, there is a point of not getting mauled on the way out I suppose!

[tommy]

I read somewhere that 15% is the standard, so I don't tip less unless service is really bad. Again, before tax, because I want to tip as little as possible.

[menton1]

Actually, in the NY Metro, 20% is the "standard". OK, I'll bite. Why "as little as possible?"

[Lixer]

I usually just tip on the Big number so post-tax, though I can understand why some would do pre-tax.

As for not tipping on the pre-discount price, it's people like you who give us coupon users a bad rap. The business decides to discount their food, not the servers discounting their service. They did the same amount of work for you as they did for a walk-in.

Your excuse of them getting more business and tips with a coupon is a very shaky and not necessarily true argument. You got a good deal already, don't be a jerk to your server who had no choice in the matter.

[LAC06488]

Pretax on the non-discounted price

[Mother of four]

Tip before tax, and always tip on the full amount before discount. Why would you tip on the tax?

[thew]

why would anyone ever worry about it?

assuming a (high) 10% tax rate, for ease of math, on a $100 dollar bill.

it's a 20 or a 22 dollar tip.

sales tax in the us averages significantly lower than that, at about 7.25%

if you can afford to spend $100 on a meal, is that buck fifty really going to put you in the poorhouse? if the answer is yes, then perhaps you shouldn't be buying $100 meals.....

]

[viperlush]

No I don't think that a buck fifty will put someone in the poorhouse, but what I don't get is why does the server deserve the extra buck fifty more than the diner? Why criticize someone for wanted to watch their money?

[thew]

maybe i sounded more critical than intended - if so apologies.

i just think, as i, and others stated above, that most people tend to round up or down anyway, and the difference in pre and post tax amounts is smaller than the amount being rounded in most cases

[monku]

Everyone has their own principles, no right or wrong and everyone thinks they're good tippers.

[Mother of four]

Excuse me, but who said I was buying $100 meals? 20% tip is certainly sufficient and I can use the extra money myself!!

[nocharge]

I friend of mine claims he never tips on taxes "as a matter of principle." I usually ask him two questions:

1. "Do you also figure out how much excise taxes are included in the price of the wine you ordered? That might save you a dime on the tip." (He's a rather parsimonious guy.)

2. "If you leave a tip in a country where prices include all taxes, as is common around the world, do you ask the waiter what the local VAT rate is so that you don't violate your principle by mistake?"

[Delucacheesemonger]

While l used to vary my tip from 15% to 20% based on level of service, for a while changed it to pre-tax x 20% to post-tax x 20% based on level of service. Now it seems l give 20% on post-tax and round up sortof just like jfood.

[jfood]

i tip on the number that is circled, the largest number on the bill or the number at the bottom. looking for pre- or post- is just too much work after a relaxing meal.

i double (i.e. 20%) and round up if the service was up to standards.

[dave_c]

My basic tip is 20% (rounded up to the nearest dollar) on pre-tax amount.
For discounted meals, I tip based upon the full price.

[beevod]

I always err on the side of a few extra dollars. Makes me happy, makes the server happy and the karma's abundant.

[thew]

while pre-tax is accepted as standard i generally tip 20% post tax and round up from there, especially if service was good.

what i don;t agree with is your discount assessment - and you point out the why in your own last line: "...shouldn't all sides receive the same level of benefit?"

the server is NOT getting the same level of benefit - they are getting 30% less tip. the owners discounting your meal - the server is working just as hard.

[fourunder]

yes, the restaurant discounts the meal, not the level of service....

[jen_om]

I'm just being devil's advocate here but the restaurant is getting more customers because it is discounting the food so the server is receiving more tips as well. A packed house wouldn't bother with a discount offering.

I'm inclined to favor a salary system for service workers rather than tip-based. That way customers can truly tip for service (or not tip if service doesn't warrant it) and restaurants can discount all they want without impacting employee compensation. It's frustrating to have to tip 20% when food and/or service doesn't deserve it. It's not the servers fault when the food is bad and it's not the chef's fault when the service is bad but when either one is off the diner isn't happy yet still feels obligated to tip 20%.

Does anyone know if a salary system has ever been tested out, put into practice in the US, or Manhattan in particular?

[thew]

2 points -

1) what you say about packed houses and discounts simply isn't true. blackboard eats often offers discounts at very popular places (in fact im doing one tomorrow night)

2) assuming the place is getting more customers - the server is receiving more tips, because the server is doing more work. that is a reduction in pay, by the amount of work done, no matter how you slice it.

[invinotheresverde]

Exactly.

Just because jen_om's butt wouldn't have been in that seat without a discount doesn't mean someone else's wouldn't have been.

[hsk]

Or because the restaurant expects more customers they have more servers working to provide the same level of service and the server still has the same number of customers.

[RGR]

I totally disagree with fourunder with regard to the tax question. Tipping on the pre-tax amount is the accepted method. The taxed amount has nothing to do with the service you receive, so there's not need to include it in your tip.

http://thewizardofroz.wordpress.com

[C0URTNEY]

I'm with RGR. Tip 20% on the pre-tax, pre-discounted meal cost, for standard service.

[uwsgrazer]

+1

[menton1]

Unless we're talking about a 50% sales tax, the difference is nit picking. Just tip on the higher amount, be a sport! (Assuming you were satisfied with the service)

[fourunder]

RGR,

That' why I responded with " * I * tip on the after tax amount ".....as indicated above to (nmprisons), having worked for tips in my youth, I've been in their shoes.....but realistically, lets say the check total is 100 bucks with an average of 8% sales tax.......for me, it's not worth what amounts to less than two bucks per hundred . You could put it another way and say I tip 21.6%.

I do agree with you that an accepted method is to tip pre-tax

:0)

[invinotheresverde]

There is no "one" accepted method, WRT tipping on tax. In fact, from working as a tipped employee for more years than I care to remember, I'd say about 80% of people swing the opposite way as you, and do tip on the tax.

[chowser]

Do servers notice this? It seems like such a small amount to notice--15-20% of 5% of the bill. It probably does in a high end restaurant but one where the average bill is about $20? That's only $1 in taxes, so a 15-20 cent difference. It's covered in rounding. Being somewhat lazy, I find it easier to use the final amount but then, I never leave change so always round up. How would the server know if I were tipping on pretax or post? And, does anyone leave change? I can't imagine having to walk around w/ a tips in change.

[invinotheresverde]

I only worked in really expensive joints, so it was easy to tell.

[kmcarr]

How cheap or expensive the restaurant does not matter since it is all percentages (tax and tip). Only knowing the dollar amounts of the bill and the tip it would be impossible to determine if the patron's intent was to leave 20% on the pre-tax amount vs 18% on the post-tax.

[invinotheresverde]

Disagree. If the total bill is $1,000 post tax, it'd be $950 pre tax where I live. If the tip left is $190, it's pretty obvious they tipped 20% pre tax.

[thew]

or 19% post tax.

but here's the question - does a server care which, or just that ze got a decent tip within the range?

[chowser]

That's what I'm wondering. With all the rounding people do (if I'm in a high end restaurant, I'd round up to the nearest $5-10), how would the server notice what's being tipped unless the customer is precise at 15% exactly off the taxed amount. How many people will get a bill for $1024.39 with tax and leave $1178.05? I'd leave $250 and call it a day. Did I pay on pretax or taxed? Does it matter?

[uwsgrazer]

No, not if you have money to burn. You just left an almost 25% tip in your example. Even if you rounded up to the nearest $10, you'd only be at $210. Hope your waitstaff appreciates your generous tips.

[chowser]

Let's also say, I very rarely eat out at restaurants that are that pricy. I hope they do appreciate it. I'm just asking if the waitstaff knows if I've tipped on pre or post tax with the rounding. And, the tip does depend a lot of service. I very rarely undertip but will generously overtip, if the service is good. I've been very lucky as that goes with high end restaurants.

[invinotheresverde]

No one bothers to figure out 19%.

I never cared, as long it was within a decent range. Tipping 15% pretax was always a letdown, for certain, but 20% is fine.

[Delucacheesemonger]

l do notice if the bill is $ 24.50 , for example, l will leave $ 29.50 on credit card, as $ 5 is easy to add, but if cash will leave $ 30 as easy for total. Thus 'change' for me depends on type of transaction. Am l alone ?

[chowser]

I do that, too. My husband used to try to round up, even on a credit card but it was way too much work and served no purpose.

[fourunder]

I tip on the after tax amount......you should always tip on the full check before any discounts.

[nmprisons]

I do this, but there is an argument for tipping pre-tax and so I can understand people who do it that way instead.

Regardless, you tip on the full check before discounts. Let's say the owner comped you a meal, would the server then get nothing? Of course not. Same thing applies to half off.