"I don't tip."

[Cleita]

25. Because of the way the restaurant business works and how the income tax is structured.

If you have a slow day and a server takes in only $50, the restaurant still has to pay, in theory, minimum wage to the server, cook and any one else involved in serving those customers. So sometimes the whole day's take will be barely enough to pay the help if that much. If you tip 20% or $10, the server usually has to share with a bartender and bus boy. Yet, she will be taxed on $4 or 8% of the bill of that whether she gets a tip it or not. If you have a busy meal period, lunch or dinner and let's say, and the same server takes in $300.00, the restaurant still only pays the same minimum wage to those involved in preparing and serving the meal and drinks and so will take in enough to pay rent, suppliers, taxes and licenses and maybe make a profit. So if 20% of the $300.00 is taken in tips or $60.00, and the tips are shared with other workers, both the server and the restaurant come out ahead. But if the server is stiffed and maybe only takes in another $10 in tips, she will end up paying taxes on earnings of $24 that she didn't get because taxes are calculated on 8% the $300.00 not the actual gratuity received. I don't know if this makes it clearer, but it's how it works.

By your method, your meal would probably cost two to three times more so that the restaurant owner could meet the expenses of paying their help during both slow and busy periods, which also tend to be seasonal as well as other factors. Also, be assured that the cheap tippers are the same guys who don't want to pay their fair share of taxes, so they will not feel any need to tip no matter how excellent the service or the meal, so those guys need to understand the basic economics of the situation.