USA: Tipping and Taxes

[Vinny]

Earlier this year I together with a group of Australian friends and associates, all of whom live there went to a restaurant in North Carolina. On being seated we were asked to quieten down while the waiter gave a speech. He told us the system was that he works mainly for tips as that was the basis of his employment and income, and he would appreciate it if we showed how much we valued his service by leaving a tip.

He said it politely and we did. Service was excellent but we all discussed how it must have felt for the guy to need to tell us this.

Tipping is the culture there and there is no getting around it. As above, remember to leave a few dollar notes on the pillow at the hotel for cleaning staff. They are very lowly paid.

I'm not a tightar$e but at times it seems everyone has their hand out. As above, keep a stash of $1 bills and put it down to that's the way things are.

I expect a big head whack from a number of posters here but this is a situation where a unionised workforce could and would make a difference for the benefit of workers. Helmet and cricket wotsit on.

 

[notzac]

Restaurants: 5-10% for truly terrible service, 15% for standard service, 20% for good-excellent service and 25% for amazing service. When working out the tip, make sure you are calculating on the pre-tax figure. If travelling for work and tips are expensable (which they ought to be), tip goes on the corporate card where possible. As others have said, watch out for gratuities that have already been added to the bill - and if you receive bad service, that gratuity is definitely open to negotiation. I've not done this myself, but I've previously heard suggestions that you do not need to tip on the wine component of your bill.

Bars: always, always tip 100% on first drink if you plan on staying a while. If you're at a busy bar, this will make a world of difference! $1-2 dollars a drink thereafter. Another technique if you're with a few people and out for a big night is to find a bartender, tip them big up front and ask them to look after you. For airline lounges, $1-2 a drink is normal (and can make a noticeable difference in attitude from the bartender when approaching the bar with an Aussie accent and a drink chit..)

Porters: $1-2 a bag. Housekeeping: $2-3 a night, unless you've left a huge mess (in which case, slightly more).

 

[casanovawa]

There is so much room for insult to be given or taken in that system which there isn't in ours... At least at the backpackers i stay out a few of these tipping issues seem to no be such an issue (ie not so many door men carrying your bags etc)..

To be frank when he asked you to show how much you appreciate his service by giving him a tip, i mean i don't see myself as a member of the ruling class or anything, but sheesh, your job is to bring the food out??? Am i expected to get up from the table and get my own food??? Its your job to bring it out and that is all i tend to expect and i don't tend to want to pay people for a fairly minimal expectation...

But yes, it is the system they have, it has its swings and round abouts, bit like the Dubai one.... i have tended to tip 10% up to now, so obviously there are many slighted yanks in my wake...

 

[harvyk]

My biggest complaint is that the rest of the world is expected to abide by the US tipping culture when in the US. Which is fair enough. But it's a shame it doesn't work both ways when travellers come. to Australia they should abide by our tipping culture as well, not the tipping culture they have in their home countries.

But we don't have a tipping culture, and that's a good thing, it means that our service staff are in fact being paid a decent income as they should.

A few years ago my wife worked for the Hyatt, she said the staff loved American tourists as they where always rich (thanks in part to our exchange rate being around US$0.50 = AU$1, and they never bothered looking up our local tipping customs, therefore staff always got tips (and quite large ones) from them.

 

[serfty]

Re: tipping in the USA a little stressed about it

The USA national minimum wage for those in industries/roles where tipping is customary is $2.13 per hour:

Minimum wage for workers who receive tips

Some states have this regulated at a higher rate, eg. in California it's USD8.00 per hour. I hate tipping as much as the next guy, but when in the USA, $1 bills are your friend. Here's an interesting FT thread:

Are you supposed to tip? - FlyerTalk Forums

Waitstaff also pay tax on a certain amount in tips that it is assumed that they have earned, whether or not they actually received it. This is to try and counteract the situation of wait-staff not reporting their tips as income to the IRS. Note that many unscrupulous 'employers' do not pay wages at all - these staff rely entirely on tips for income (but don't fret, these more likely than not don't pay tax either).

[MOD HAT]

I have merged two thread on the same topic; it may be beneficial to re-read from the January posts.
​

[/MOD HAT]

 

[cove]

We double the tax on the restaurant bill in California and that works ok.

 

[JohnM]

I don't minding tipping in the US as I understand the situation regarding the wages of service staff. However, I object to paying it as a percentage when I've bought an expensive bottle of wine. So generally, I tip a fixed amount, rounding to the $5 or $10.


Sent from my iPad using AustFreqFly app

 

[cove]

Well JohnM having a partner who does not drink and prefers not to drive means I would have a beer and iced water at a Californian restaurant like Flemings at El Segundo (near Los Angeles airport on the south side).
Yes it is painful for an Australian to pay a tip on top of a high priced bottle of wine and we all feel the same about that!
My pet tipping dislike is at a bar in a 5 Star hotel where the bar tender just gets the top off a beer that they want $10.50 for (when it is available for a dollar at my local supermarket) and then there is a tip.

 

[Stephen65]

It's not necessary to tip on expensive wine in the same way as you do for food. Sure you can tip 15%-20% on the wine if you want but it's perfectly acceptable to take into account a substantial wine component of the entire bill and adjust the tip accordingly. I'd be sure to tip at least 10% on the entire wine inclusive bill though because otherwise the waiter/waitress may end up out of pocket as the IRS deems them to earn 8% on the gross sales of food and beverages.

 

[mr mink]

I have not bothered to troll through all of these pages because the general sentiments are fairly clear.

To put my experience into context, I spent four weeks touring around California in the middle of last year, then six weeks through the southern US at the beginning of this year.

Because of my bag being on wheels I never felt (or didn't stay in a swanky enough hotel?) that I needed a porter to show me to my room. Therefore definitely no small notes required there.

Effectively the only place that I therefore tipped were in restaurants. I generally did rounding up in the order of 10 -- 15% on a credit card. I was never made to feel somehow embarrassed because I had somehow "stiffed" someone with not getting enough -- Americans are too polite for that.

The idea of compulsory inclusion of a service charge in the bill, as in France due to an industrial law I believe, is wholeheartedly supported but that would no doubt be regarded as socialist by our American friends! However we are dealing with free enterprise here and very low wages for servers etc. you will soon see that there are effectively about three tiers of service people in restaurants for example which is somewhat bizarre given their notional "no class divisions" culture (other than on money lines of course).

 

[JohnK]

And my stance on tipping has not changed. I will tip when I want to tip not when someone tells me I have to/need to tip.

I don't need to go to a restaurant to enjoy myself and I carry my own luggage.

As for bartenders. A $1 tip to open a beer bottle. Serious? And I do not tip in any of the airline lounges.

Taxi drivers won't get a tip especially when the tip has been added to the fare already. They may get some loose change.

Have I left anyone out?

I have met some of these so-called bartenders, waiters, porters, croupiers (who supposedly live off their tips) in Thailand and they do not behave like people struggling to make a living. In fact it is not uncommon for some of them to have bar bills of at least 5,000 baht a night, sometimes much much more.

I am not out to make friends and more than likely will not go out to the same place more than once.

And by the way it is Ok for foreigners not to tip in a lot of places in the USA. They actually expect Australians and other foreigners not to tip....