(a)  Where a purchaser provides a gratuity for an employee or employees of a seller, and the gratuity is wholly in the discretion of the purchaser, the gratuity is not subject to the tax imposed by this article, whether paid in cash to the employee or added to the bill and charged to the purchaser’s account, provided, in the latter case, the full amount of the gratuity is turned over to the employee by the seller.

(b)   A mandatory gratuity or service charge that is added to the price of the meal by the seller, and required to be paid by the purchaser, is not a part of the selling price of the meal and is exempt from the tax imposed by this article, but only to the extent that such mandatory charge does not exceed 20% of the sale price.

(Ord. No. 06-9(R), 6/27/06)