How to Tip in the Dominican Republic

Traveling to the Dominican Republic? Punta Cana? Santo Domingo?

Tipping in Punta Cana for Americans
By El Grupo Thornberry, Dominican Republic

When we bring tenants, friends, clients, and partners in our fractional condominium ownership program in Punta Cana to the Dominican Republic for the first time, they all say the same thing…the food is amazing and the prices are incredible! We Agree!

It is not uncommon to get a meal here in the Dominican with an insane view, a fancy environment, and four times the service staff you would expect in the States all while spending $25-$30 on a plate you would have spent $50-$100 on in a simple chain steakhouse for mediocre food. Here you can expect amazing food virtually anywhere in Punta Cana and we have a restaurant directory for you to check out. www.Dominican.US.com

When the bill comes you will want to know how to tip because here in the Dominican Republic tipping too little (or none at all) would be classless…but over-tipping can be offensive.

“ITBIS” and “Ley”

When you get the check, you will almost always see “ITBIS”. That is basically the Dominican’s way of making tax revenue happen. People here hardly claim any taxes on their personal incomes and the country doesn’t have the resources to go chase down tax debts even if the average Dominican made more than just a few hundred US dollars per month. This fee is 18% and it is easy to compare to a slightly higher sales tax than what we are accustomed to in the States.

Most of the time (but certainly not always) you will find a line called “Ley”. It is generally a 10% fee and don’t bother trying to translate this into anything that makes sense. The literal translation is “law”, which is somewhat deceptive when you look at your bill for the first time here. If you know even a little bit of Spanish and you see the word “Ley” with a 10% amount of the bill attached to it, it appears to be a tax or some government requirement. It is a forced tip, much like they do on South Beach and in Fort Lauderdale.

If you only see ITBIS as a line item and nothing that says “Ley” (or some other word with a 10% fee), then there has been no tip added. In that case, 10-15% would suffice, 20% if you received amazing service and are feeling generous.

If you do see a line for “Ley”, it would be fine to offer 5-10% additional tip. If you do much more than that, you run the risk of offending others around you (including Dominicans you might be dining with) as this is a major faux paus here. The predominant thinking behind this is that if you over tip, the staff will gravitate towards you and service for others even paying a normal level tip will be diminished. There’s also a cultural concept here that buy over-tipping you are increasing the overall labor costs within and outside of hospitality.

I know it all sounds ridiculous to an American, especially when we see endless news stories about famously generous tippers and how we respect those that serve us. This may seem like disrespect, but its actually not. The intention from all is to create a stable level of growth for the working class here on the island.

Now that you know the acceptable amount to tip...do you tip on the credit card slip or in cash?

We’re sure you know where this is going! Yes, the wait staff would prefer cash tips. This is a fairly universal concept, but here in the Dominican they REALLY want cash tips. Remember that 18% ITBIS? Well anything paid to the employees through the business is assessed a tax out the door. If you tip $5 USD, $1 will go to the Dominican government.

If you want to make your servers happy in the moment, tip in cash. Simply convert RDP (Dominican Pesos) to USD (United States Dollars) and then tip according to the amounts stated in the last section. You will be appreciated in the moment, but we think there is a better way for you and for the Dominican Republic.

It is our position that it is best to tip on the tip line of your bill and to simply add the amount needed to cover the taxes for the server. In other words, if the tip should be $5, make it $6. If you have a business reason for being there (as oftentimes do our partners in the El Grupo Thornberry fractional ownership system), then you have a tax write-off that exceeds the benefit to the employee by more than the extra tip that made up for their tax payment. There is no downside to anyone, there’s a tax benefit to you potentially, and there is more money going to a developing country that is doing an excellent job at adding infrastructure daily that makes this wonderful place even better.

Sometimes you will receive a credit card receipt with no tip line and no signature line. If you ask for one to sign, you will often get one to sign. The reason you were given a slip with no signature line was an attempt to encourage cash tips. Seldom, but it does happen, you will be told that “it was already closed out”. This is nothing but a deception to attempt to force you to find a few greenbacks in your pocket.

Why would a server attempt to force a cash tip in this manner?

If you experience this, you are likely at a restaurant where the proprietor (or his managers) are not very trusted by the staff. The staff likely believes, accurately or not, that tips (or as they call them here “propinas”) are not being shared in full with the employees. They may also feel that more employees are being brought into the tip pool than deserve to be. It’s also possible you met the greediest, most selfish server in the place.

When this happens, I often just go towards the minimum level cash tip and leave it in $1 bills. While you could leave nothing and “teach them a lesson”, perhaps even leading to an improvement in the restaurant and compensation of employees, it would take a lot of people doing so to have that effect. We just leave a minimal tip in that circumstance and don’t make a stink about it. We know the more this country advances, which can’t happen without taxes being paid, the better, but we pick our battles!

In summary…

With 10% Ley: 5-10%, preferably on your credit card.
Without Ley: 10-15%, preferably on your credit card.
No Credit Card Slip: 10% in $1 bills (USD)

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www.Dominican.US.com