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I dislike the elimination of taxes on tips because it opens a new loophole for rich assholes but I'm 100% behind eliminating sub-minimum wages.
It does feel like we should be encouraging the end of tipping, not asking it to stick around forever.
Removing the minimum wage exception to tips does help with that. Part of the reason why tips are inventived
Plus taxes on tips as they exist already has quite a number of assumptions that tipping will always exist. For instance, assumptions of a minimum 8% tip rate for reporting. Which will be withheld from pay from at least that assumption (which you can get back if you earn less by filling)
Wouldn't the elimination of taxes on tips entrench that non-taxable income as something servers would die before ever surrendering? Treating it as income means that whether that money is coming from hourly vs. tips is irrelevant and, at the end of the day, hourly compensation is always more reliable if all else is equal.
This was my concern, but if y'all think servers will give up their tax free tips... sure...
Yes, it would.
It would be preferrable to change the tax code on it differently, yes, but unfortunately in elections that going to be difficult to explain to people rather than the much simpler "no taxes on tips"
Mind you that trump has the same plan on tips tax removal here but without any of the minimum wage change stuff
You think the tax coming off their tips is enough to make servers indifferent to them?
If they are guaranteed minimum wage then at least I can feel like they aren't going to starve if I don't tip the ever increasing suggested tip %.
A server can easily work 4-5 tables an hour. Assuming average bill of $50 per table, and average of 10% tips, that's $20-25 per hour. That average is most likely higher because of people like you who feel guilty and use the suggested tips lol.
PLEASE ENTER YOUR TIP PREFERENCE HERE
25% 28% 35%
^skip^
Swivel the ipad 360° and walk away
Wouldn't that just point it back at you?
Also they just pick the tip amount then.
I agree, and we'd have to do it carefully so tipped workers continue making roughly the same as they do now.
Where I live a handful of trendy restaurants announced opened as no-tipping restaurants. They would add a 20% gratuity to every bill and claim it was used "to support a living wage and benefits" to the staff. Usually it was just sucked up into the revenue pile and used however the owner wanted.
If restaurants dropped tipping, raised their prices by 20%, and paid their staff 20% more, I would be okay with that. In the European countries I've visited, it seems to work just fine and food is still cheaper than where I live.
Harris's proposal specifically includes an income limit to prevent people like hedge fund managers and lawyers from structuring their pay as "tips". Trump's version predictability does not.
It sucks for more than just that though. There's 0 reason for tipped workers to pay less in taxes over workers making the same just by virtue of being tipped.
I would say the reliability of pay is a good reason. Tipped workers can't count on a consistent amount of money. A bad month or even a bad week can mean rent doesn't get paid.
That can happen to anyone if they're fired.
And that's why we have workers compensation. The government subsidizes wages in times of hardship. Cutting taxes on tips would allow those workers to weather periodic lulls better.