DUBAI - Restaurants in the UAE will have to stop adding service charge to customers' bills from Wednesday or face heavy fines as the government looks to stamp out excessive charges, UAE daily Gulf News reported on Wednesday.
Restaurants were given a one month grace period to take service charge off bills after the Economy Ministry ruled them illegal amid complaints that some eateries were adding as much as 20 percent on top of the cost of the meal.
The ministry in December ruled service charge fell foul of the country's consumer protection law, branding it illegal and ordering it be removed from bills immediately.
The directive led to mass confusion among customers as many eateries continued to levy service charge, claiming they had not received any official notification, leading to authorities extending the deadline to comply with the ruling.
The grace period ended out on Wednesday, but most outlets have now started complying, Gulf News reported.
The Economy Ministry has set up a website for consumers to file complaints against any restaurants flouting the service charge ban, the newspaper said.
The ruling only applies to restaurants that operate independently outside the hotels and clubs.
Hotels and outlets inside them impose services charges but also pay a municipal tax, which is 10 percent of the bill in Dubai.
Revenues from hotels and business fees are an important non-oil source of income for the UAE, especially for oil-poor tourism hub Dubai.
