Lifestyle Food Thrifty city-dwellers avoid service charge in KL by ordering takeaways then dining...

Thrifty city-dwellers avoid service charge in KL by ordering takeaways then dining in at the same restaurant

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Kuala Lumpur—Every cent counts. Every penny matters. The mandatory 10 percent service charge imposed is too much for the diners wanting to sit and eat in a fine restaurant that some people in KL find a way to circumvent it. They dine and eat their ordered takeaway food. This has become a trend in the capital city.

Branded as the heart of Malaysia, Kuala Lumpur’s cost of living is getting expensive. It ranked 296th out of 447 cities in the world and with a cost of living index of 41.09 according to Numbeo, the world’s largest database of user contributed data about cities and countries worldwide providing current and timely information on world living conditions including cost of living, housing indicators, health care, traffic, crime and pollution.

Service charge is an additional rate usually implemented by service providers towards consumers for the service delivered. It is different from the service tax and other taxes levied by the government. Service providers in the hospitality industry like restaurants and hotels are allowed to charge a 5 – 10% rate of the total bill for service charge.

Service charge actually tips for the employees given that tipping culture is not really practiced by Malaysians. It is meant to supplement the low income of employees for the amount collected will theoretically then be shared among all employees at the end of the month. Service charge encourages better service too so that customers will patronise the establishment.

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On the other hand, sales and service tax (SST) is a form of indirect tax imposed by the Malaysian government on taxable persons for specified “taxable services” under the Service Tax Act 1975 [Act 151]. It was reintroduced middle of this year permanently scrapping the gross and service tax (GST).

The trend has become a coping mechanism for the rising cost residents endured in their daily living. Residents insist that they are just being smart in spending their money and they just want to save some ringgits.

They added that anyway, they are still supporting the businesses by still buying food from these restaurants. Other residents also maintain “I want to be able to enjoy the luxury of eating out without ripping a hole in my pocket.”

Photo: Screengrab from YouTube

But everyone does not agree especially the restaurant owners and supervisors. They felt that they are short-changed and asserted that their businesses are losing thousands of money every month.

The question of being ethical doing it seems to cloud the claims of the residents. One restaurant manager feels that it is a “violation of our honesty”. She adds, “we try our best to be honest; that’s why we have a sign that says the restaurant charges service charge and tax.” Service charge is stated in the menu.

Even the Malaysian Franchise Association, a non-governmental organization, which assists franchise businesses, including restaurants, is aware of the issue of residents foregoing service charges.

Mr Mohamad Shukri Salleh, association’s secretary-general, proposes a solution for both sides: “While we urge diners to be more considerate, what these eateries can do is take advantage of the situation by turning it into a marketing strategy – use social media to show that many people actually go to their restaurants. It can be a win-win situation for all.”

 

 

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