00:00Well, expectations and attitudes on tipping vary around the world.
00:04In China, Japan, and much of Asia, tipping remains rare.
00:08Tipping can be refused, considered embarrassing, and even insulting.
00:12It can be seen as implying superiority over someone carrying out an important service.
00:18It's also uncommon in Scandinavia, where service workers have higher incomes compared to other countries,
00:24meaning they aren't dependent on tips.
00:27However, it is common practice to round up a bill in a restaurant as a sign that you've enjoyed your meal.
00:32Across the rest of Europe, tipping waiters and sometimes hotel staff and taxi drivers is more common,
00:38with expectations of around 5 to 10%.
00:42In restaurants, a gratuity is often added to bills automatically,
00:45although that's recently caused controversy in Spain, where it's still a relatively new practice.
00:51But the leader in the tipping stakes is the United States,
00:54where customers are expected to add up to 25% on their restaurant bill,
00:5810% in cafes and for takeaways, and a dollar per drink in a bar,
01:03as well as tipping taxi drivers, delivery drivers, and hotel workers.
01:07Well, some are arguing that tipping has gone too far in the United States,
01:10leading to buzzwords like tip fatigue, tipflation, and guilt tipping.
01:16Let's talk to Jasmine Bertels, a financial journalist and personal finance commentator.
01:20Good to see you, Jasmine. Welcome back to the program.
01:22So what do you think? Are tips fair game and should be counted as earnings,
01:27or are they a gift for good service and shouldn't be taxed?
01:31No, I think they should be taxed, and I'm glad that the Greek government has stuck to its guns.
01:36Clearly, this is all part of a big cleanup in Greece,
01:39because as you know, it used to be just a few years ago that its debt-to-GDP ratio was over 250%.
01:47Now it's come down to over 200%, still a lot, but it's going in the right direction.
01:52And I think this is all part of it. They're getting the tax money in.
01:56And my concern about tips generally, certainly, I mean, obviously, I'm British, I live in London,
02:01tipping is normal in restaurants and hotels, as you point out.
02:06But it does, I think, foster this low-pay problem that we have in Europe,
02:14well, particularly in Britain, I think, in the hospitality sector.
02:20Whereas, say, last week, for example, I was in Paris.
02:23In Paris, on the whole, they don't expect to be tipped because the waiters are paid a sensible wage.
02:29And I would like to see that. I think that companies are really holding on to individuals
02:36to keep their businesses going, whereas really they should simply pay a fair day's pay for a fair day's work.
02:44And I think, you know, rather than giving it to us, the consumer, to shore up their businesses.
02:51You talk about low pay because, in general, people in the service industry are not necessarily the highest earners.
02:56Is there an argument to say that it's perhaps unfair to target these people
02:59rather than something like big corporations, high earners, who could be paying more tax?
03:06Well, that's absolutely true, yes. And as you say, it would be fairer.
03:11It's harder. So I suspect that they're going for the low-hanging fruit at the moment.
03:16I mean, every parliament, every government that we have in the UK,
03:20and I'm sure it's the same in other countries, always says,
03:23we're going to go after the non-payers, we're going to go after the companies
03:26and the high net worth individuals that are not paying their tax.
03:30But we know that they won't, really, because those people, those organisations, have very good accountants.
03:36They have good lawyers. So it's actually quite hard to go after them.
03:40So in the meantime, yeah, they are going for the low-hanging fruit.
03:43And it is a shame, but I think it would be fairer to actually get rid of tips altogether
03:49and just make people, make companies pay a fair hourly rate or day rate.
03:54And then we have this somewhat different situation in the United States,
03:58where we're talking about tipflation, tips going up.
04:03Do you think the way that they do things in the United States has taken it too far?
04:07Yeah, I really do. Just recently, I've had a few friends who've been in New York, for example,
04:12and they were staggered to go into just an ordinary shop, buy a sandwich or get a drink or something, do it themselves.
04:19They pick out the sandwich themselves, they pick the drink out, they take it to the counter,
04:23and then they're told that they should give a tip, and it starts at 20%.
04:27I mean, for a European, that's staggering.
04:30So I think, again, it's companies trying to abrogate their own responsibilities
04:35and put it onto the customer.
04:37So you go into a shop or into a restaurant, you think you're going to be paying a certain amount,
04:42and then at the end, you find that you're slapped with a whole load more money that you need to pay.
04:47And this is unfair to workers, and it's unfair, I think, to the consumer.
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