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Home / Travel

USA gratuity tax: Why I refused to pay tips on my two-week trip

By Lauren McMah
news.com.au·
4 Jun, 2019 05:42 AM4 mins to read

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Need a guide to the US gratuity culture? Here are our tips. Photo / Getty Images

Need a guide to the US gratuity culture? Here are our tips. Photo / Getty Images

Tipping isn't just polite in the US — it's kind of expected. But one Aussie traveller says she got through a two-week trip by refusing as much as possible.

Few things really drive home the difference between here and the United States as the culture of tipping.

Here, we might fling a few dollars in the direction of someone who really went out of their way to be excellent.

In the US, where service wages are so low tips supplement people's incomes, leaving gratuities isn't just appreciated: it's pretty much mandatory.

But one Australian traveller refused to buy into the practice of tipping in the US, and managed to travel through the country by barely doing it at all.

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Sydney traveller Natasha Cameron, 26, spent two weeks on the east and west coasts of the US before a four-month trip to South America and avoided tipping as much as possible.

"I had started the first leg of my five-month trip and was on a very tight budget," Ms Cameron said told news.com.au.

"I was also uncertain as to how much was acceptable to tip. For some of the trip we bought from the supermarket and takeaway to avoid having to worry about tipping and having that awkward encounter. I had saved for years to go on this trip and was not working for the duration of the holiday, so every last penny really did count."

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Australians in particular have never been really into the tipping thing. According to a new survey of Aussie travellers by travel search engine KAYAK.com.au, 21 per cent of us "never tipped" and a measly 16 per cent tipped waiters if the service was great.

However, 43 per cent of travellers said they would leave a tip in a country where gratuities were expected, such as the US.

It's around $1 a drink tips in US bars. Photo / J. Lawler Duggan, Getty Images
It's around $1 a drink tips in US bars. Photo / J. Lawler Duggan, Getty Images

The US isn't the only country with a strong tipping culture — travellers are generally also expected to tip in Mexico, South Africa and some countries in Europe. Restaurants, bars, hotels and taxis are where travellers are nudged to leave a tip.

But Ms Cameron said she didn't feel forced into tipping during her American holiday.

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"People in the US are really friendly to Aussie travellers, so I never felt pressured into tipping," she said.

"However, I myself did feel guilty and would often second-guess myself. There were occasions where I left a small tip. I think being a tourist and sometimes not understanding the tipping etiquette can impact perceptions and attitudes."

Ms Cameron said she didn't tip in Australia unless rewarding exceptional service. On a recent trip to India, she occasionally left tips when the service was really top-notch.

In the US, tipping isn't just about good manners — it's actually factored into labour laws.

Tipped workers earn less than $US3 an hour in 24 US states, and less than $US5 in 12 other states, according to the US Department of Labor.

Bosses can pay wages that low if those wages, combined with tips, meet the federal minimum wage of $US7.25 ($NZ11) an hour. The Kiwi minimum wage is almost double that, at $NZ17.70 an hour, regardless of tips.

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Tipping in the US is a confusing system many have tried, and failed, to overhaul. But Ms Cameron thinks a change needs to happen.

"I think (this) definitely does need to change and starts with the restaurant owners," she said. "There is often a tax on top of the bill, so with tipping as well, it really does add up.

"As someone who has worked in restaurants and cafes growing up, I do believe wages are great (in Australia) by comparison to other countries. While I did appreciate a tip from time to time, I did not expect it and therefore don't think people should.

"If the service is exceptional and someone has gone out of their way to help me, then I think it is a great way of showing gratitude."

Guide to US gratuity: Here's our tips

For travellers heading to the US, the general guide in restaurants is to tip at least 15 to 20 per cent of the bill. You don't need to tip at fast-food eateries like McDonalds.

At bars, it's about $1 per drink. A dollar or two is the expected gratuity for hotel porters who help with luggage. It's about $2 or $3 for hotel housekeepers per night.

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And for taxis, whack about 10 to 20 per cent on top of the meter total.

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