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Restaurants Will Soon Be Able to Add 10 Percent ‘COVID-Recovery Charge’ to Customer Checks

Cloris Ying (Unsplash)

Sept. 16, 2020 By Michael Dorgan

Restaurants will soon be able to add a 10 percent service charge to the tab.

The City Council voted Wednesday to approve legislation that would temporarily permit restaurants to add a “COVID-19 Recovery Charge” to customer checks.

The legislation is expected to be signed by the mayor – which would then go into effect immediately — and last until 90 days after full indoor dining is restored.

Restaurants have been decimated by strict COVID-19 lockdown measures and indoor dining – which has been barred since March – is only set to resume at 25 percent capacity on Sept. 30.

The restrictions have already forced many eateries to permanently shutter due to a loss in business and plummeting revenue.

The legislation was passed on a 46-to-2 vote and overrides a previous law that prohibits restaurants from charging any fees beyond the price of food, drink and taxes.

Restaurants that choose to implement the charge would have to notify the customer by placing it at the bottom of each menu as well as stating it on the customer tab.

Staten Island Council Member Joe Borelli, who introduced the legislation, said the charge will help restaurants cover rising labor costs and COVID-19 compliance costs.

“This bill fundamentally is about saving the restaurant industry,” Borelli told the New York Post after yesterday’s vote.

“We’re trying to give restaurants the option of adding a surcharge to let their customers know they need to raise a little bit more money to make their ends meet,” Borelli said.

He added that restaurants are continuing to close down because they are losing money while operating under coronavirus restrictions.

The NYC Hospitality Alliance is backing the legislation saying that many restaurant owners told them a surcharge would help them generate revenue to purchase PPE, cover outdoor dining expenses and keep workers employed.

Queens Council Member Adrienne Adams was one of only two representatives who voted down the legislation arguing that low-wage restaurant workers may get smaller tips because of the surcharge.

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9 Comments

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Bill

I don’t understand. What’s the difference between this add-on and simply raising prices 10%? Sounds like unneeded bureaucracy to me!

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Al Neuman

Typical Democrat thinking. We will help your business by asking your customers to pay more. Brilliant. Any data to support this move? Probably not. The curve has been flattened for months. Countless protests, riots, and other acts of civil disobedience have demonstrated that the virus has not spiked, the “second wave” is a fairy tale. You want to help restaurants out? Let them reopen already.

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Did Trump's brother die of COVID?

The second wave is based on the skyrocketing American deaths. Shame you don’t respect them.

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Enough BS

I’m fine with higher prices but they should be displayed upfront in the price of the item. USA is the only country where it’s legal for customer to be lured into an establishment by seemingly reasonable prices and then leave the establishment after paying 30% more than expected.

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Ortiz

Eating out was already expensive and unsafe , now this tax will make it harder for me to eat out. I will be cooking a lot more!

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Old Astorian

At least you don’t have to put your health and the health of your family at risk by working in a restaurant.

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ivan

Agreed. There is already a 8.75% tax plus waiters nowadays EXPECT 20% tips and now an additional 10%!! every 10 dollars worth of food you order end up being almost 14!! This is going to alienate people who may not go out so often in exchange or leave less gratuities. At the end of the day customers will be unhappy, waiters will be pissed and the total revenue of restaurant will actually diminish. If that is the plan from the city to help hospitality, it’s exactly like our mayor: half baked.

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