What is the service charge used for and why the cost isn’t reflected in menu prices?

Apparently service charge generally means tips not expected.

Apparently one place in touristy part of Portugal mentioned they don’t charge service fee thus tips are expected.

It appears in many restaurants in the far east where tipping is almost unknown they would most always charge a 15% service charge.

Edit: I be curious whether people are afraid that if everyone stopped tipping there will be no incentive to good service anymore which seems the sad reality for other industries such as fast food, supermarkets, and airlines especially those with tenured union members which been declining in the last decades. And that all the restaurants would just charge a mandatory 15%-20% service charge going to who knows where like elsewhere I the world.