A receipt says ‘We are a no-tipping establishment’ next to a 16% fee, and a user asks if Sugarfish thinks diners are ‘too dumb to notice’

A diner’s receipt from Sugarfish by Sushi Nozawa in Los Angeles shows a 16% fee alongside a note that reads, “We are a no-tipping establishment,” according to BroBible. A Reddit user shared the image on r/EndTipping, a subreddit that pushes for pay models that do not depend on tips. The bill lists a $34 Toro Tasting and a $24 lunch set, followed by a $9.28 charge for the fee and $6.56 in tax.

The fee works out to 16% of the $58 in food. “Look, a ‘no-tipping establishment!'” the poster remarked in a caption on the image. “How refreshing, right?” One commenter asked whether the restaurant thinks customers are “too dumb to notice.”

The restaurant’s own website addresses the charge directly. The menu page lists the Toro Tasting at $34. It says, “This is not a gratuity or tip. We are a no-tipping establishment.” The site adds that the fee is taxed under state law and goes toward funding the restaurant’s operations.

No tipping, but a 16% fee

“I don’t understand their thinking,” one commenter complained. “Do they think the average customer is too dumb to notice 16% fee a mere 3 lines from the We are a no tipping establishment disclaimer?” The outlet stated that it emailed the restaurant and the poster for comment. A 2023 Pew Research Center survey of 11,945 U.S. adults found that 72% said tipping is expected in more places than five years earlier.

Fieldwork ran from Aug. 7 to Aug. 27, 2023. The same survey found that 72% oppose businesses adding an automatic service charge or tip to the bill, while 10% favor it. California sets rules for mandatory fees. Under Civil Code 1770, advertising a price that leaves out mandatory fees is prohibited. The law exempts government taxes and fees, such as sales tax, and it also carves out mandatory fees on food and drink sold by restaurants.

That restaurant exemption holds only if the fee is “clearly and conspicuously displayed, with an explanation of its purpose,” on any advertisement, menu or other display showing the price. The state attorney general’s office says the pricing law took effect on July 1, 2024. It adds that restaurants are exempt as long as the fee is clearly and conspicuously displayed wherever prices are shown.

It also says fees for optional services need not be included in an advertised price. On taxes, California’s tax and fee agency treats an amount automatically added to a bill as a mandatory charge subject to sales tax. Its guidance gives a printed menu notice that a gratuity or service charge will be added for larger parties as an example of a mandatory charge.

At the federal level, the FTC’s fees rule covers businesses that sell live-event tickets and short-term lodging.