Québec is trying to stop its patrons from leaving bigger tips than they realize.
What happened: A new law came into effect in Québec yesterday that forces businesses to calculate all gratuities based on the final bill before tax. The Québec minister who first proposed the bill says the change is aimed at making sure tipping remains a choice for consumers.
Why it’s happening: It’s best practice for tips to be tallied based on the subtotal, but many of the payment terminals used by businesses automatically calculate them based on the after-tax total. Still, no other province has laws to stop it from happening.
- The difference can add up. The after-tax calculation can bump your tip from 15% to ~17.25% in provinces where the sales tax is 15%.
- And those default tip options matter: one survey found that 62% of Canadians leave a higher tip than planned because of the options on the pay terminal.
Why it matters: The growing reliance on higher and more frequent tipping has put both diners and workers in an uncomfortable spot. Almost all Canadians feel tipping culture’s gotten out of control, but servers can earn up to 75% of their total compensation from tips.
Bottom line: Any new laws like Québec's that cut into tips would likely lead to staff needing higher wages — raises that many business owners won’t be able (or willing) to pay.—LA