Service charge

Hotel Service Charges: Collectors urged to enforce new rules on hotel service charges

The Central Consumer Protection Authority (CCPA) has directed district collectors to enforce guidelines issued regarding service charges by hotels and restaurants. Upon receipt of complaints, district collectors were instructed to investigate and submit the report to the CCPA within 15 days.

CCPA has also written to chief secretaries of all states and district collectors across India to arrange for wide publicity of the guidelines as well as its immediate implementation for the protection of consumer interests, the business department said. of consumption (DoCA) in a note.

Last week, the CCPA ordered restaurants and hotels to clearly inform consumers that service charges are voluntary, optional and at the consumers’ discretion and that they also cannot restrict entry or refuse services based on the collection of service fees. “The service charge will not be collected by adding it to the food bill and deducting GST from the total amount,” the guidelines state.

The DoCA had criticized restaurants in May for charging service fees, following complaints from consumers.

The was triggered by numerous complaints the department had received through the National Consumer Helpline.

From April 2021 to July 2022, 537 complaints were filed by consumers regarding the collection of the levy. Top grievances include restaurants making service charges mandatory, embarrassing consumers in case they resist paying service charges, adding service charges under another name, and withholding that paying service charges is optional and voluntary.