You might soon find an extra charge on your next café or restaurant bill — and no, it’s not a mistake. As costs surge across the hospitality industry, more venues are quietly adding automatic tips to customers’ bills. It’s a growing trend that’s sparking debate over fairness, transparency, and Australia’s long-standing resistance to tipping culture.
A Subtle Shift in Dining
Automatic tipping, which adds a pre-set service charge to a bill unless customers opt out, is becoming more common in major cities like Sydney and Melbourne. While still relatively rare, it’s starting to appear in higher-end venues and tourist hotspots. Under Australian consumer law, businesses are allowed to apply such fees if they clearly disclose them — but that doesn’t mean diners are happy about it.
The discussion took off recently when a Sydney wine bar added a 10 percent tip to customers’ bills without prior notice. The backlash was swift, and the restaurant dropped the policy within days. Yet the incident raised an uncomfortable question: in an era of rising costs, are automatic tips the new normal?
Rising Costs, Tight Margins
The push toward automatic tipping reflects the growing strain on hospitality businesses. From higher wages to soaring electricity bills and increased food costs, venues are struggling to balance their books. Industry figures argue that these surcharges can help restaurants stay afloat without constantly increasing menu prices.
Many businesses that cater to international visitors say the practice makes sense. In countries like the United States, tipping is second nature, and overseas tourists often expect it. With international travel nearly back to pre-pandemic levels, some venues see automatic tipping as a natural way to meet those expectations, explains ABC News.
Australians Divided Over Tips
But Australia’s relationship with tipping has always been different. Here, diners tend to see tips as optional — a gesture of appreciation rather than an obligation. Workers are paid award wages, which means tipping isn’t essential to their livelihood. For that reason, many locals see automatic tips as out of step with the country’s service culture.
Some also worry about transparency. When a tip is added automatically, customers often don’t know where that money goes — whether it reaches the waiter, the kitchen staff, or simply stays with management. That uncertainty fuels frustration and skepticism, especially as household budgets tighten.
The Numbers Tell a Story
Even with the resistance, tipping overall is rising. Recent data suggests Australians and tourists together now leave about $3.5 billion in tips annually. The number of transactions including a tip has jumped more than 13 percent year over year. Victoria tops the generosity chart, with diners averaging nearly $40 in tips per meal, while Western Australia lags behind at around $12.
For now, automatic tipping remains a niche practice — but it’s one that may grow as the cost-of-doing-business crisis continues. It’s also likely to stay divisive. Some customers may view it as a small price to pay to support struggling venues, while others will see it as one charge too many.
Either way, the next time you’re handed a receipt, it might pay to look twice. Because that little “service charge” could be the latest sign of how much Australia’s dining scene is changing.
