Editor's note: This very same question was recently posed again in the Food section’s Facebook group, and generated so much discussion that we’re republishing the original answer.
Q: It is my understanding that in calculating the tip, the amount to be used is based on the pre-tax total. Staff does not need to be tipped for taxes collected, especially in high tax areas (New York, Charleston, San Francisco). What, in your opinion, is correct?
A: The only thing certain in American life is that people don’t like tipping or taxes. So the idea of having to ante up for both at once understandably aggravates diners.
Unfortunately for folks who keep a tight grip on their purse strings, tipping on the total, including tax, is the right thing to do.
There are no requirements when it comes to tipping, which is why it’s such a controversial system. Diners are free to leave nothing at all, forcing front-of-house staff members to rely on the generosity of other customers to close the gap between the $2.13 they’re paid per hour and a livable wage. In other words, you’re absolutely entitled to tip on the pre-tax figure if you so choose.
But acting like taxes don’t exist is disingenuous at best and miserly at worst. Your servers pay the same high tax rate you do when they’re buying things like gas to get to work, or groceries to feed their families. Perhaps more pertinently, they’re taxed on their tips, so it only seems fair for you to acknowledge the government’s share.
And, in all but a few states where the practice is outlawed, it’s legal for restaurants to pass along credit card processing fees to their employees. In South Carolina, that means a server may only see $4.85 of a $5 tip, prior to withholdings and tip-outs for bartenders, hostesses and bussers.
Finally, it’s worth noting that if you can afford to eat out, you should be able to afford to absorb the difference between tipping on the pre-tax and post-tax totals. Let’s say your dinner bill comes to an even $100: If you tipped without regard to tax, you’d be expected to leave $20. In downtown Charleston, the permissible sales tax rate is 11 percent, bringing the taxed total to $111, and your tip to $22.20 (or close to it. Unless service was outstanding, I’d probably leave $22 in this hypothetical situation).
How measly is $2 in a restaurant setting? I checked a few local menus, and here’s what you can buy with $2: Almost nothing. Your choices include 7 ounces of Miller High Life at The Darling Oyster Bar, a bag of Zapp’s chips at Caviar & Bananas, sweet tea at Rodney Scott’s BBQ and half a meatball at a number of Italian restaurants.
Yet for just $2, you can treat your server with respect, and avoid being labeled as a cheapskate, which is a reputation you don’t want should you plan to patronize the restaurant again.
(By the way, if it pains you to think about tipping on tax, you could also just shift your standard tip to 22 percent, and pretend like tax has nothing to do with it.)