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No more service charge, now; Govt issues fresh advisory to states

New Delhi, Apr 21 (UNI) In what could be called a step to put an end to confusion, the government today issued a guideline that no hotels and restaurants charge services tax from customers mandatorily and asked the state governments for its effective enforcement.

In a series of tweets, Consumer Affairs Minister Ram Vilas Paswan today said, “The government has approved guidelines on Service Charge. As per guidelines Service Charge is totally voluntary and not mandatory now.”
Now, the service charge will totally be at the discretion of consumers.
“Hotels and Restaurants should not decide how much Service Charge is to be paid by the customer and it should be left to the discretion of customer,” the minister added.
The state governments have been asked for its effective implementation.
“Guidelines are being sent to states for necessary action at their ends,” Mr Paswan said.
For the second time in the last five months that the government has sent advisory to the states to get them to reach out to hotels and restaurants and make sure they desist from adding a service charge to their customers' food bills.
States would also be asked to make sure that restaurants put up a board at an appropriate place that makes it clear that "service charges" was a voluntary payment and consumers dissatisfied with the services can have it waived off.
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