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Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

theguardian.com

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Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#31

Post by [deleted] »

nickfromseattle wrote: post #24
r00fus wrote: post #7

Earlier quoted context omitted.

What's to prevent corporations and the rich from taking advantage of this? ie, my job is $10k + rest in "tips"?

The easiest seems like who is paying the "tip". If it's your employer, it's taxable compensation. If it's a customer, than it could be a tip. Then there would probably be a bunch of sub-bullet points defining whether a tip is taxable depending on whether you have a direct relationship with the customer tipping you, whether the "tip" is mandatory, or at the discretion of the customer, are you in X roles (e.g. barista)…

[deleted]

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#32

Post by bcrosby95 »

I dislike this proposal. Just like I'm not a fan of $20/hour minimum wage for fast food in California. I don't see why we should hold service workers that get tips, and in California's case, those that work at fast food, above other wage earners.

It feels degenerate that the government is signalling to us that we should e.g. work in fast food and as a waiter over preschools and child care.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#33

Post by _yb2s »

more_corn wrote: post #2

How about no tax on people below the poverty line? When I was young it always killed me to make so little and still pay taxes.

Isn't that essentially already the case in the USA? The standard deduction for a single person is $14,600/year and the federal property level is very close to that at $15,060/year.

It's kind-of weird how these levels are set equal nationwide... as there are regions where this is a decent living and one could own a small single family home or condo, an older but reliable car, and eat well on that salary... and places where you would be homeless and have no day to day security or stability required to even keep a job.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#34

Post by ribosometronome »

silisili wrote: post #19
Aunche wrote: post #10

Increasing the tipped minimum wage means that restaurants will add that cost to the menu. Because tips are based a percentage of your order, this means that customers actually pay more money in tips, even though these laws are marketed as reducing the need for tips.

I think (hope) the expectation is to eventually increase wages and prices and phase out tips altogether. Tip culture has gone insane...even my home inspector's last invoice has a tip line!

Not taxing tips will increase the reliance on them rather than remove it.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#35

Post by throw_m239339 »

kitkat_new wrote: post #27

tips should be banned not only is it a shitty source of income, it also exposes you to sexism, racism and makes you tolerate shit things, because your income could be at risk standing up for yourself.

In some cultures, people "tip" teachers, police officers, doctors, politicians, judges... you know where I'm going with that...

I'm not saying tips should be banned but there certainly is a "cultural aspect" to tipping...

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#36

Post by NotACop182 »

nickfromseattle wrote: post #24
r00fus wrote: post #7

Earlier quoted context omitted.

What's to prevent corporations and the rich from taking advantage of this? ie, my job is $10k + rest in "tips"?

The easiest seems like who is paying the "tip". If it's your employer, it's taxable compensation. If it's a customer, than it could be a tip. Then there would probably be a bunch of sub-bullet points defining whether a tip is taxable depending on whether you have a direct relationship with the customer tipping you, whether the "tip" is mandatory, or at the discretion of the customer, are you in X roles (e.g. barista)…

Easier way is to put a cap on how much you make. Let’s say 70k. Make more you don’t get the exemption prevents the rich from gaming the system.

Also define tips by industry. Service sector. End of story.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#37

Post by silisili »

ribosometronome wrote: post #34
silisili wrote: post #19

Earlier quoted context omitted.

I think (hope) the expectation is to eventually increase wages and prices and phase out tips altogether. Tip culture has gone insane...even my home inspector's last invoice has a tip line!

Not taxing tips will increase the reliance on them rather than remove it.

Absolutely. The article in question is about how it runs counter to increasing said wages instead, and the comment I'm replying to I think is saying if we raise wages tips will raise. Which is true, short term.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#38

Post by FigurativeVoid »

afavour wrote: post #17

IMO it's just bad policy all round without a significantly higher level of detail. For example, how do we classify a tip vs a wage? If we're not very, very specific about it's going to be yet another tax loophole exploited by the rich who will pay each other $1 for work and then 'tip' thousands more. Sure you’re an engineer on staff now but wouldn’t you want to be a freelancer, paid minimum wage and then a healthy “t…

I would say this is ridiculous, until I read Snyder v. United States[1,2].

> Held: Section 666 proscribes bribes to state and local officials but does not make it a crime for those officials to accept gratuities for their past acts. Pp. 7–16.

1. https://www.supremecourt.gov/opinions/23pdf/23-108_8n5a.pdf.

2. https://www.scotusblog.com/case-files/cases/snyder-v-united-...

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#39

Post by diob »

bko wrote: post #12

I don't like tipping culture, but it does allow for wealthy people to subsidize service and incentivizes good service. People that are more price sensitive tip lower and every once in a while a waiter will experience an extremely generous tip. I'm not convinced that forbidding tips would increase net wages paid to servers. In terms of who is paying, restaurants will simply raise prices to account for higher wages. Th…

I've actually gotten much better service in places like Australia / Japan where tips aren't a thing.

From my understanding, poor people are often the best tippers in the USA, and rich folks tend to not tip.

Re: Is 'No tax on tips' a distraction from the fight to end sub-minimum wages?

#40

Post by leumon »

bko wrote: post #12

I don't like tipping culture, but it does allow for wealthy people to subsidize service and incentivizes good service. People that are more price sensitive tip lower and every once in a while a waiter will experience an extremely generous tip. I'm not convinced that forbidding tips would increase net wages paid to servers. In terms of who is paying, restaurants will simply raise prices to account for higher wages. Th…

I've noticed much higher level of service in the US compared to Europe were tips are not expected as much

Might be true, but I don't think that's necessarily a good thing. If someone is forced to be excessively friendly/caring because he/she fears that otherwise he/she might not get enough pay, this is a toxic work culture in my opinion. Also (even though I don't have data on this) it might also create unfair advantages to certain people, for example I think it might be possible that people who are more attractive (especially in restaurants) get payed more. But for the last thing I am just guessing here.

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