Comment tipping = gratuity = discretionary (Score 5, Insightful) 93
That's what a "tip" means. It's an amount paid at the discretion of the consumer, meant to express appreciation for the service rendered.
If it is automatically applied, it is not a tip. If an establishment does not include it in the price of the goods or services, then it is an anti-consumer effort to mislead or deceive. A message or disclaimer saying "a X% service charge will be added on all prices/items" is inadequate disclosure. To understand why, simply make the advertised price 10% of the true price and make the service charge 1000%. If the consumer has to do mental math to get an accurate understanding of the true cost of the goods or services being advertised, that is inadequate. Moreover, the use of such tactics is itself evidence for its shadiness, since why do it at all if it does not confer some advantage to the seller?
A truly level playing field must have totally transparent pricing: the price that is advertised must be what you pay. If there is any tax or service charge, it must be mandated by law and it must be the same percentage for all establishments, so that the consumer has a reasonable expectation that if they take their business somewhere else, they are paying the same rate. But these bottom-of-the-menu disclosures (when they even happen at all, which at least in the US, they sometimes don't) are deceptive practices that business owners use to try to hide the true cost of doing business.
More insidiously, they are also used to capture some or all of the tip income that servers have traditionally received. Some establishments say that this is done in order to be fairer to staff that are not front-facing. But I argue that business owners can and should do this through appropriate setting of wages in the first place. Doing it by capturing tip income through service charges is, again, deceptive. The business owner has full control of the employee compensation structure and consumer-facing pricing structure. That they are so fond of playing games with both means that whatever excuses they make are not to be trusted.