There are different cultures, and different customs associated. When I first travelled to US, in 1997, I did not know about the fact that tipping was "mandatory".
Here in Europe we are not used to such a mandatory tipping, and I generally never tip here.
Here in Italy we are instead used to asking for a discount, paying LESS than the standard price, both for food, drinks, or a for a taxi ride. Paying MORE looks completely absurd to us...
So I incurred in a number of unpleasant situations, until a waiter at the hotel did take the time of explaining me how the tipping system works in the US. Generally speaking, it is the only way for normal workers for not being ripped by the taxes, as tips are generally undeclared as an income.
This made me even more nervous, here in Italy people who take actions far avoiding taxes are considered the worst of criminals, true parasites of the society. My wage at the University is paid by the Italian public administration, and people saving on their due taxes are ripping my country and making it more difficult to pay my wage.
This means that I am totally against this concept of paying workers through untaxed tips instead of through a regular wage, subjected to income tax.
But I had to adapt myself to the local customs, so when I travel in countries were tipping is mandatory, I always tip at the minimum allowed and typically using the credit card so I have proof of the tip paid (which is of course required when I present the bills to my administration, for being refunded of the travel expenses).
Another problem I often encounter is that in many places I do not get a proper legally-bounding bill when I pay. I need it for being refunded, it is not acceptable that, when traveling for work, I loose money due to payments not providing me a proper bill.
I find profoundly wrong to tip by cash, leaving no electronic track of the payment. And I always pretend to get proper receipt for the tip paid, for being refunded - no receipt, no tip!. I respect the work done by waitresses and other service personnel, but I find unacceptable that I have to loose my own money not being able to be refunded for feeding this absurd tipping system.
Luckily enough these concepts are now widespread, and getting an electronic receipt for the tip paid is becoming more standard nowadays.
Per the IRS, the US federal taxing authority, tips are SUPPOSED to be declared as income.
Are Tips Taxable? IRS Offers ‘Tips’ on Tips | Internal Revenue Service