Its just the wage structure there. Low. Meals in non 4 or 5 star restaurants can be moderately to incredibly cheap (ignoring FX), so giving a tip of 15% doesn't really force the price up offensively. The problem for me is that the service can be terrible and you are still expected / obliged / choose your situation to tip. Its a coughpy situation, but I go with the 'when in Rome' philosophy.
If the service is actually terrible, I'd recommend you summon the manager or other superior. A negotiation from there may result in some resolve to your satisfaction, e.g. a good substitute meal, items comped on the bill. Depending on how bitter you are after that resolve, you may choose to give the standard or reduced tip. If your negotiation yields no satisfaction, then feel free to not tip or, as
drron says, offer the repartee insult - a penny.
The only time you would likely give a tip for absolutely terrible service is to give yourself the easiest and quickest way out of the establishment, albeit a rather non-ideal (both theoretically and practically) way. Some would just get up and walk out well before the bill arrives, but that does take gusto.
I'm not sure if anyone here is happy about it, but you recognize the local customs and adapt to them (even through gritted teeth).
Tipping is not limited to USA, though it is the most prevalent example (and likely more so since it is an English speaking nation).
A handful of countries in Europe still work on tipping; some are simplified, e.g. just add a small amount and round up to the next whole unit. England has a 12.5% "optional service" which is added to the bills of restaurants with service - you need to review the bill and ask for it to be removed if you so desire (but be prepared to explain your position or at least gather death stares).
As a bit of a parallel against our normally "all inclusive" notion in Australia, in Italy, although bread is frequently free of charge to consume, you will more than likely have an extra charge of a Euro or so for "
pan e coperto" (bread and cover). This applies even if you don't touch a single crumb of bread. In Australia, this would be likely against the law and you would need to either offer the bread for free or add it to the menu explicitly.