An HST drop of one per cent started April 1 in Nova Scotia, impacting tabs at restaurants.
“Anything that makes business or just going out to eat less expensive, especially these days, is a plus,” says Brendan Doherty, owner of The Old Triangle Irish Alehouse.
Doherty says there has been a bit of a conversation around the reduction in tips that they may see.
“But as I always say, if you sell a thousand dollars, that comes out to about 10 dollars less in tips with the one per cent less reduction but if you get one extra table and they are in for dinner, you’re going to make far more than the 10 dollars,” says Doherty,
In Nova Scotia, tip suggestions on the terminals are added to the total after tax. This is the case everywhere in Canada except Quebec.
“Quebec has a law that when you have percentages it needs to be applied on the pretax. As for everywhere else in Canada, that law does not exist so it’s on the entire bill,” says Janick Cormier, vice president of Restaurants Canada.
“For a server, obviously, if you are tipping on the entirety of your bill not just the cost of the meal but on the included tax, that means its 15 per cent more and now 14 per cent more in Nova Scotia. Your bill is higher, then your tips will be higher, then you will make more money at the end of the night.”
In a statement, the Restaurant Association of Nova Scotia said it is still assessing the effect this HST change will have on the restaurant industry, but they don’t expect any major changes.
“Any reduction to the sales tax is welcome as it reduces costs and means a little extra funds for potential customers. In terms of overall impact on industry, it’s still early days to know for sure, but we don’t expect that we’ll see any major changes in dining out habits or tipping,” says executive director Natasha Chestnut.
Etiquette expert Julie Blais says we should be tipping before the tax, not after.
“Tipping is a cultural custom and generally speaking about 15 per cent in restaurants before tax,” says Blais.
Blais says whatever happens to taxes, people should still do the math themselves and when it’s very good service, instead of 15 per cent, tip 18 per cent.
Even in economic uncertainty, Blais says tipping should remain on the table.
“If we start to reduce our tips, we are affecting our community members. Let’s keep true to this collective agreement that we have for tipping culturally, that’s the etiquette of it,” says Blais.
At the end of the day, Cormier says tips are at the discretion of the customer.
“You get to decide what you feel is adequate for the service you receive. If that’s easier for you to hit 20 per cent on the machine instead of doing the math yourself, you do that. It really depends person to person,” says Cormier.
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