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“No tax on tips” is an industry plant

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Re: “No tax on tips” is an industry plant

#391

Post by wat10000 »

flanked-evergl wrote: post #284
wat10000 wrote: post #263

Earlier quoted context omitted.

It means that you paying taxes on your pay is equivalent to your employer paying taxes on your pay. If you shift taxes to the employer, then they will reduce your pay accordingly.

Never ever once has an employer given me a pay raise when they got a tax cut or a pay cut when they got a tax hike. Taxes do not feature into salary negotiation. Employers pay as little as they can get away with, while employees want to get as much money as they can. If you need theoretical worlds with no correspondence to anything ever in actual history to justify your claim, then maybe there is not that much to it.

Where do you live that employer-paid taxes on employee pay have been cut during your career?

Re: “No tax on tips” is an industry plant

#394

Post by xp84 »

kalaksi wrote: post #308
kelnos wrote: post #196

Earlier quoted context omitted.

I don't think we should be tipping at all, even for exceptional service. The job is the job, and the employer should be paying the full amount that job is worth. If the employee is doing it exceptionally well, going above and beyond, the employer should reward them with a raise, same as for salaried positions. That's assuming the employer values that above-and-beyond-ness, of course. If not, they won't give that rais…

Yes, I have also been thinking how a similar reward system would work without tipping. Just use a bonus system based on customer feedback. And the flow could be very similar to how it is with tipping.

It's not worse than tipping, but we've already normalized the obnoxious idea that every transaction needs to earn five stars. You know the places. The ones where they warn you "You're going to get a survey, if there is any reason why you don't feel like you can give us a 5 please tell me" (unsaid: Please sir -- they flog us for 4 star ratings). I can't imagine anyone I know not rating an Uber 5 stars, unless they were say, called a slur or the driver caused an accident.

So, I'm not sure how to best construct a system not open to "guilt gaming" in this way, but I would like to see one.

Re: “No tax on tips” is an industry plant

#395

Post by pc86 »

miltonlost wrote: post #387
pc86 wrote: post #377

Earlier quoted context omitted.

What's crazy is that you can so confidently claim "tipping is a thing of the past" when it's... not? You can think tipping should go away, that's a completely valid viewpoint. But your statement is just objectively wrong. I see this a lot (not specific to HN) - some person doesn't like $THING, so they just declare that that thing is bad, or "a thing of the past," or whatever.

"Horse riding is a thing of the past" is both clearly true and also wrong if you are being incredibly obtuse. The average person is not riding a horse, but there are still horse riders. I see this a lot - some person doesn't like a phrase ("a thing of the past"), so they just misread it and take it clearly the wrong way.

Even among the incredibly predictable "omg USA so backward tipping lol" comments here, there are a lot admitting that tipping still exists for exceptional service in certain industries.

You won't find a single non-barista in the US who thinks it's reasonable for Starbucks to solicit 20% for someone pouring your coffee into a cup. But restaurants have tried the "don't tip our waiters" thing in the US and it doesn't work.

Re: “No tax on tips” is an industry plant

#396

Post by Barrin92 »

reissbaker wrote: post #178
paganel wrote: post #176

Earlier quoted context omitted.

Service is quite good in Europe if you ignore the touristy areas. We’re also not into that fake-smiling thing, so maybe that can be seen by an American as “bad service”.

I don't care about smiling. I care that when I want to leave, I can pay quickly. In Europe, it's incredibly slow, pretty much everywhere, including random rural towns in the middle of nowhere, including for random other patrons who are locals. The best service I ever witnessed in Europe was like, maybe mid-tier American fast casual level: aka, mediocre.

> I care that when I want to leave, I can pay quickly. In Europe, it's incredibly slow

Maybe when you come to Europe adjust to the culture. In Europe you don't eat with the clock in your hand so you can run off too the next meeting while you're still chewing. This isn't bad service, it's part of eating out that you don't storm off and take your time.

An ordinary European restaurant doesn't work with the tempo of a McDonalds, that's a feature and not a bug.

Re: “No tax on tips” is an industry plant

#397

Post by rtp4me »

tombert wrote: post #264
KennyBlanken wrote: post #118

Earlier quoted context omitted.

No, it's spreading because corporations are waking up to what an insanely good deal "pay my employees for me" is. In my state an employer is only responsible for raising an employee's effective wage (for the entire pay period) to minimum wage if the tips don't. You can tip someone working as a waiter $100 and unless they've already hit minimum wage for that pay period, all you're doing is handing $100 to the owner be…

In a sense this policy has kind of saved me money, because I have simply been avoiding restaurants that expect me to tip and cook at home more often. I hate pretty much everything about tipping. The onus shouldn’t be on some fucking customer to determine if a server makes rent this month. I really hate that pretty much every payment terminal asks for a tip now.

Same here. We have really cut down on the amount of "out for lunch/dinner" activities we plan. One reason is the tip situation; the other is because we can cook as well at home than out of the house. In the past (80s), going out to dinner was considered a real treat. In the 2000s, it was commonplace. Now, I think we are back to the 80s mentality (cost, tipping, food quality, etc)

Re: “No tax on tips” is an industry plant

#398

Post by rayiner »

It’s simpler than that. It’s gross vote buying and political patronage. Nevada has a large population of tipped service workers. Trump won the state by the largest margin for a Republican since W. Bush in 2000 (back when the state was 65% non-hispanic white versus 45% today). It was probably instrumental in Trump winning hispanic men nationally.

Re: “No tax on tips” is an industry plant

#400

Post by 9rx »

kelnos wrote: post #228
9rx wrote: post #83

Earlier quoted context omitted.

> Tips subsidize profits, plain and simple. Nah. Profitability for the business would be higher without tips. I take x% of gross income as profit. No tips means I can charge the customer more, which means a higher gross income, which means more profit. When tipping is involved, the money slips through without allowing the business to take its cut. Good for the server, but not good for the business. However, as theore…

It's not that simple. Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages. Raising restaurant menu prices by 20% (or the average tip amount) will not result in 20% (or the average tip amount) more going to the workers. Some restaurants have tried this out, and it's backfired. Restaurants already run on very thin margins; a loss of a few percent can kill them. Also consider that cust…

> Restaurant owners don't pay payroll taxes on tips, but they do pay it on regular wages.

Payroll taxes in most jurisdictions are based on wages, not profitability of the business. A non-issue, well, except maybe for the server who has grown accustomed to making $50/hr. No tips and those days are long gone.

> Some restaurants have tried this out, and it's backfired.

Yup. Hard to win customers when tipping is part of the experience. I mean, it can be done where it isn't — McDonalds survives, thrives even, without tips — but if you are trying to run the type of restaurant where the customer comes to tip it doesn't fly. You have to give the customer what they want at the end of the day, else they'll go somewhere else. This is the challenge businesses face.

> Restaurants already run on very thin margins

Exactly, and if you increase the volume then the product of the margin gets bigger. Remember, Walmart and your average restaurant have the same profit margin! Walmart's advantage is that they handle way more money, so the total amount that margin represents is huge. If a restaurant can also handle more money...

> seeing 20% higher prices on the menu will make them spend less.

Even just, say, 1% higher still means more cashflow through the business, which means more cash to take a cut from. You are right that the full 20% would unlikely ever be realized, certainly not right away, but it doesn't need to be to still be advantageous. But until you figure out how to convince the customer to change their preferences about tipping, good luck.

There is absolutely no obligation to leave a tip. One only does so because they want to!

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