Time to clear the air:
10% goes to employers/ company's revenue - they claim that their waiting staff's pay already take into account that 10%. (yeah right)
P.S. if service is bad, you can get them to take off the 10% service fee!!! not exactly done often but you can raise hell.
Notice that in hotels, there's that additional cess of 1% - that goes to STB (eventually to Shatec and the likes I guess) Notice that restaurants which are not in hotels don't have this charge.
Then, there's the 4% GST.