13 ms·

“No tax on tips” is an industry plant

302 points by littlexsparkee 1y ago

bigyabai 1y ago
It's also a joke, because anyone who's worked a service job knows there is no tax on cash tips (wink!)
- deleted 1y ago
  [deleted]
- garciasn 1y ago
  I have an honest question: what's the cash vs card tip ratio? 99.999% of the time I am not carrying cash and I don't see many (any?) people paying with cash ANYWHERE in the last 10+ years.
  - joshstrange 1y ago
    Almost no one can give you a good answer because it varies by business type and location. My business does not involve tips (exactly) but I can tell you that I’ve seen anywhere from 20-40% of money run through my system being in cash, depending on where I am in the country.
  - lelandfe 1y ago
    NYC here, whole lot of cash still showing up in tip jars - there are still and loads of cash-only places around, from bars, restaurants, to street carts, you name it. JG Melon, for instance, is famously cash only. But so too is the bar around the corner from my apartment (Dynaco, do recommend). ...So people often tend to be carrying cash still.
    - kelnos 1y ago
      Sure, but more places take card, and fewer people carry as much cash. Or rather, people carry less cash. The fact that a business "famously" is cash only seems to support this, as that implies that it's becoming more unusual.
      - lelandfe 1y ago
        It’s certainly unusual for a famous restaurant to not accept cards. Everything else is a crapshoot. If you don’t have cash you aren’t getting dumplings in Chinatown. And that’s just a bummer!
  - Workaccount2 1y ago
    At this point you are litterally a sucker to pay for anything in cash, because everything is marked-up to cover CC fees, which you get a portion of back in the form of rewards. Yes, I know some places give cash discounts. Most do not.
    - godelski 1y ago
      I pay tips in cash. There's technically no CC fees on that.
    - frollogaston 1y ago
      Not everything is marked up to cover CC fees, and any time there's a CC surcharge, it's more than the points you get. That and the tip is separate.
      - kelnos 1y ago
        As the GP said, most places do not give a cash discount (the equivalent of a CC surcharge), though that practice is indeed a bit more common than it was a decade ago. Interestingly, I've see this practice in odd places like my utility and phone bills (they don't charge an extra fee if you instead link your bank account or use a debit card, which I don't love, but... here we are). And even if things aren't marked up to cover CC fees, if you have a rewards card, you're effectively paying more if you pay in cash.
        frollogaston 1y ago
        Idk. Where I live, it's very common. Almost every gas station does it, about half the restaurants, and yes every utility. 0 grocery stores though. The fee is at least 3%, and no card offers that level of cashback, though you might be able to do the equivalent of 5% with airline miles. Cardholder agreements used to disallow CC surcharges, but I think such clauses were outlawed.
      - deleted 1y ago
        [deleted]
  - littlexsparkee 1y ago
    in SF I only carry cash for dive bars and the occasional mom n pop diner
- WorkerBee28474 1y ago
  Sounds like those Americans aren't paying their fair share.
  - bigyabai 1y ago
    The negligence of their national responsibility will be felt like an earthquake by millions of Americans. It's hard to imagine how they live with themselves.
- crazygringo 1y ago
  Which made a difference 2 or 3 decades ago. But today, who's getting tips in cash? Not many. Customers are paying for everything with credit cards or contactless, save for the occasional cash-only coffee shop or restaurant.
  - bigyabai 1y ago
    I should have specified that I live in the east-coast United States. Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.
    - deleted 1y ago
      [deleted]
    - kccqzy 1y ago
      Saying east coast is too vague to be useful. I live on the east coast too and there are entire weeks where leave all my credit cards at home and only pay via tap-to-pay.
    - hdgvhicv 1y ago
      Contactless is basically non existent in America? I know America has always been backwards (cheques were still in use well into the 21st century, card pins didn’t seem to catch on before contactless became a thing about a decade ago), but I thought contactless was quite high nowadays, especiallly with phones and watches. Certainly I’ve had no problem paying contactless in the cities I’ve been to recently - New York, DC and Miami.
      - tallanvor 1y ago
        Keep in mind that inertia is a thing. Businesses used to have to make an impression on your card on carbon copy paper and physically send the slips in to be processed. When they started swiping cards, restaurants would only have one terminal and it had to be connected to a phone line to work. Both of these situations made it common for you to hand your card to the waiter (usually in the book they brought the check) because they couldn't do it at the table. Credit cards caught on later in other parts of the world, and they benefited from having more modern options with regards to the equipment used. Governments and banks also did more to mandate the use of security features (chip & pin) than in the US - American banks like people using credit cards - it makes them a lot of money and they're incentivized to keep the barriers low as long as the amount of fraud is manageable to them.
- sundaeofshock 1y ago
  When I worked as a waiter (many years ago), my pay check included tax withholding based on 8% of my tables for that pay period. This is driven by IRS rules: https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total%20tips%20reported,to%20whom%20you%20allocated%20tips. https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total...
  - JamesSwift 1y ago
    We had to declare our tips at the end of the night, and 10% was the lowest you could claim without needing manager approval. You can guess what everyone declared.
- JamesSwift 1y ago
  Haha, I had the same thought but now basically everyone is digital so I think its a different ball game than we are used to. At least as a restaurant server/bartender.
littlexsparkee 1y ago
Some interesting points: ~40% of tipped workers don't make enough to get taxed anyway, no tax on tips would actually advantage better paid workers like casino dealers who don't need the help. NToT is described as a campaign to distract from minimum wage increase initiatives.
- toomuchtodo 1y ago
  https://jacobin.com/2025/07/restaurant-industry-tipped-subminimum-wages/ https://jacobin.com/2025/07/restaurant-industry-tipped-submi... https://jacobin.com/2020/10/tipped-restaurant-workers-waiters-coronavirus-subminimum-wage https://jacobin.com/2020/10/tipped-restaurant-workers-waiter... https://cepr.net/publications/customer-tips-are-providing-the-lions-share-of-wages-to-tipped-workers/ https://cepr.net/publications/customer-tips-are-providing-th...
  - Aloisius 1y ago
    I live in California and this isn't true here. All restaurant workers receive at least minimum wage before tips. In my city, that's $19/hour with health insurance. Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore. I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
    - msikora 1y ago
      California doesn't have a special minimum wage for tipped professions? When I was waiting tables a long time ago I think my pay was $1.95 an hour. It was usually just enough to cover tax on tips (the ones we admitted).
      - Aloisius 1y ago
        Nope. Tipped workers are paid full minimum wage in California.
analog31 1y ago
How about the tips that I get as a musician?
- cammikebrown 1y ago
  Do you report them?
  - analog31 1y ago
    Of course.
- Workaccount2 1y ago
  The IRS is going to publish a list of eligible occupations by years end.
  - beefnugs 1y ago
    like being president, and getting crypto tips from supportersuckers
    - ourmandave 1y ago
      It's amazing how the Saudis managed to fit a 747 into a tip jar.
      - optimalsolver 1y ago
        I think that was Qatar.
      - potato3732842 1y ago
        You have to give them credit for the biblical metaphor.
    - analog31 1y ago
      There will be a separate bill for emoluments.
111111IIIIIII 1y ago
[dead]
steveBK123 1y ago
All bonuses soon to be labelled as tips.
- limagnolia 1y ago
  This is unlikely to be allowed, the last I checked, the law explicitly only allows "traditionally tipped jobs". How it gets interpreted and implemented in IRS Tax Code isn't clear yet, but they will probably have rules in place to prevent this. Doesn't change the fact that it is a terrible idea.
  - hirvi74 1y ago
    Hmm, this makes me wonder though -- I have noticed various projects on Github and various other sites allow for users and fans of projects to donate to the developers and maintainers. Who hasn't seen the "wanna buy me a coffee?" button on a site before? I am not sure if the money from such sources was ever taxed as income, but if so, then I wonder if such will be non-taxable now? Considering donation and tip buttons have some history behind them, perhaps such "jobs" could be considered "traditionally tipped jobs?"
    - atomicnumber3 1y ago
      Technically that money should be reported on a 1099 misc. but is it generally enough to even have an auditor look at it? I'd guess not. But you do technically need to.
    - dml2135 1y ago
      They will publish a list > (h) Published List of Occupations Traditionally Receiving Tips.-- Not later than 90 days after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary's delegate) shall publish a list of occupations which customarily and regularly received tips on or before December 31, 2024, for purposes of section 224(d)(1) of the Internal Revenue Code of 1986 (as added by subsection (a)).
- onlyrealcuzzo 1y ago
siliconc0w 1y ago
"No tax of tips" is one of the most brilliant political ploys ever. You really gotta give Trump credit. It doesn't really cost anything, businesses love it, and you can trot it out as a victory for the working class while you screw them on their health care or energy costs.
- Workaccount2 1y ago
  Trump is a populist president. People just don't recognize it because right-wing populism is a different breed than left-wing populism (the only one they have had exposure to). Tariffs are a populist move as well. If you go look at Bernie's old website (pre-trump) he has a whole section about the importance of tariffs.
- Bukhmanizer 1y ago
  It’s not really, it’s the kind of thing that only a populist could do. If a Democrat did this, people would hate it for this very reason. This would just another “NeoLib” concoction to screw the working class.
- frollogaston 1y ago
  Idk, tipping expectation is really unpopular, and anyone can see how this feeds it.
Larrikin 1y ago
Don't forget to reduce your tips by the percentage they were previously being taxed, since it is all charity anyway. Hopefully this becomes another straw that will eventually break the camels back and we get rid of tipping all together. Every restaurant in the world does not need tips to survive, except for the ones in the US.
- toomuchtodo 1y ago
  Tips subsidize profits, plain and simple. But, America runs on poverty, so this is in line with the broader socioeconomic strategy.
  - 9rx 1y ago
    > 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 theoretically great as it sounds, you are ultimately beholden to what the customer wants. There is good reason why every restaurant that has tried a "no tips" policy has failed. Nobody shows up to dine. They go somewhere else where they can tip instead. Regular people actually enjoy tipping, as hard as it may be to believe for those who are staring at screens rather than enjoying the ambiance of a restaurant.
    - hdgvhicv 1y ago
      Why do you take a fixed profit. Why don’t you charge the amount which maximises profit?
      - 9rx 1y ago
        Because x% is the maximum profit. Not even places like Walmart, for all their might, have figured out how to exceed the same x% (somewhere around 2-3%).
    - 1y ago
godelski 1y ago
I think with any conversation about tips it is really important to recognize that laws vary dramatically across states[0]. I think talking about this can really drive at the real underlying issues with tipping. IMO most discussions about tipping are a distraction. "Divide and rule" if you will. == THE LAW == (or my best understanding. IANAL) For most of the west coast (AK, CA, OR, WA): there is no separate "tipping wage". Tips are *always* on top of *at least* state minimum wage. There is only one minimum wage, so tipping is always a "bonus". Other places, there are two "minimum wages", but that's confusing because at the end every employee has to make at least the normal minimum wage. The difference is that employers can use tips as credit against this. So, with the exception of Georgia (WTF GA!), employees *must* make the state's minimum wage (default federal). Using federal (min wage = $7.25) an employer *MUST* pay you *no less than* $2.13/hr. This is conditioned that you have made *at least* $5.12/hr in tips. The problem here is what tips count to what wages. Per day? Per week? Per paycheck? DOL says "workweek"[1] ============ So the real (main) problem is actually just straight up good old wage theft. Anyone who is not getting at least minimum wage is suffering from wage theft. I've heard stories of employees not getting a paycheck "because employer thought it was all tips" (illegal b/c they credited too much) or very small paychecks with the explanation that the employer over-credited tips. There's at least a decently straight-forward way to show what can be credited, and this is why there's the tip amount that you log. Ignoring cameras, the burden is on the employer to prove that they can make these credits, so that line-item on the bill is important (IANAL) Personally: I think the entire discussion of tipping often only serves as a distraction to wage. Like there's a lot of person to person fighting of how much we should tip (including not tipping) and frankly, doesn't this discussion often boil down to wage theft? I mean ignoring the already illegal problem of wage theft, what makes a server (who gets tipped) any different from a cashier (who doesn't get tipped) as an employee. Their jobs differ in duties, but we're talking about wage and *fair pay* here. If all the laws are followed, a tipped employee strictly benefits from tips. They have a statistical wage but that wage is max(base_pay, state_minimum) + random_value. So I think 90% of discussions around tipping end up just being a distraction to create a fictitious divide of "minimum wage workers" vs "tipped workers"[2] who should instead be working as a coalition to increase the floor. They are both minimum wage earners! The main difference is primarily that tipped employees are just more likely to suffer from wage theft, due to how they are paid. But that's also something that both experience, just at different rates. TLDR: Getting rid of tips as a concept is a simple solution to the wage theft problem, but isn't the real problem just good old fashion wage theft? (second problem being "is minimum wage minimum"?) [0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped https://www.dol.gov/agencies/whd/state/minimum-wage/tipped [1] https://www.dol.gov/agencies/whd/fact-sheets/15-tipped-employees-flsa https://www.dol.gov/agencies/whd/fact-sheets/15-tipped-emplo... [2] Simplifying by ignoring tipped earners with higher than min wage base pay (we can extend as needed)
david38 1y ago
How is an expected tip different from a commission other than who pays? This is rather brilliant. * make it look like the government is stealing “gifted” money * stop taxing it * turn as many jobs as possible into tipped jobs supposedly for the person’s benefit * really the employer wins since they’ll pay less and claim “tips”
andreareina 1y ago
https://archive.is/20250731232051/https://www.newyorker.com/magazine/2025/08/04/no-tax-on-tips-is-an-industry-plant https://archive.is/20250731232051/https://www.newyorker.com/...
Simulacra 1y ago
I worked as a server for about a year in college, and when we would check out at the end of the night, literally, everyone would just put zero. As in they didn't earn anything. Every time. I'm sure it mess with the taxes in someway or another.
evo_9 1y ago
According to my accountant for my wife’s small business (nail and wax salon) this tax law change will have a significant positive impact on her staff. Not sure what to make of this article, it seems pretty disingenuous.
- kelnos 1y ago
  N=1. Just because your wife's business doesn't fall under the conditions that the article is talking about, it doesn't mean that her business is the norm.
  - evo_9 1y ago
    Sure, my experience isn’t with sharing, basically. Nice.
- aprilthird2021 1y ago
  I'm just planning on tipping less to make up for it. In California minimum wages are already $20/hr, and on top of that so many places expect a higher %ge, tip, just cutting my tip by the 10% they pay in tax and being done with it. I pay taxes on my wages. They should too
oellegaard 1y ago
It’s crazy that this still happens in the US. Tipping is a thing of the past. Pay for your meal and have the restaurant pay their people for their work. End of story.
- efitz 1y ago
  There’s very little empirical evidence correlating tipping with better service.
  - frollogaston 1y ago
    No, they're definitely more attentive for the tip, I just don't like it. If they're going to be extra nice, I don't want it to be for money. Felt nice going to other countries like Australia where the customer isn't always right but they still do their jobs.
    - ecb_penguin 1y ago
      Bud, literally nobody gives a shit about waiting on you. They are literally only doing it for the money. People in Australia are still doing it for the money, even if you don't realize it.
      - ghiculescu 1y ago
        As an Australian who lived in America for 5 years - it’s bonkers to claim the service is better (or even as good) in Aus. It’s clearly more attentive in the states, anyone who says otherwise has an agenda. Sometimes you don’t want good service - as in, you don’t want a server to talk to you. That’s a lot easier to find here.
        frollogaston 1y ago
        Yeah, this exactly matches my experience visiting Sydney from the US, it was great. I'm not antisocial, in fact I enjoy talking to strangers, but it feels very wrong to pay them for it.
ojbyrne 1y ago
“No Tax on Overtime” ditto. As I understand it if it’s overtime negotiated through a union contract, you’re out of luck.
photios 1y ago
I don't like tipping as much as the next guy, but this isn't about that. It's about government overreach and privacy. Governments tracking small transactions like tips and taxing them should bother everyone. That rag, the New Yorker, knows that of course.
thuridas 1y ago
Aren't we creating incentives for workers abuse: - No tax on overtime: so now making them work 60 hours a week is cheaper for the employer - No tax on tips: so the tip based payment model is cheaper
- entropi 1y ago
  Yes, and my understanding is that this is precisely the point.
- ghiculescu 1y ago
  How is it cheaper for the employer?
  - gog 1y ago
    For the same amount of money employee gets it requires employer to pay out less.
    - ghiculescu 1y ago
      That’s not how income tax works, particularly for minimum wage workers.
      - RobinL 1y ago
        It's just supply and demand. It makes working in these industries relatively more attractive, increasing supply of labour and therefore reducing price of labour. So restaurant owners capture some of the benefits
        ghiculescu 1y ago
        So employees earn more, and restaurants spend less. And this is bad because?
        RobinL 1y ago
augment_me 1y ago
I can kind of see the average traditional service work position to shift into a Uber-esque model where you are a essentially a gig contractor. The worker takes the full risk for slow days, and the business owner does not have to pay you a salary, as everything comes from the customer.
- alkonaut 1y ago
  That’s exactly what US waiter employment is. And it needs to die.
floppiplopp 1y ago
[flagged]
SSchick 1y ago
My tips have been going down progressively, when I moved to the US I was taught 20% is "normal", now I tip 15% at MOST at restaurants and at MOST 5% on take out. I'm tired of being shamed to pay more for less. Also whoever was in charge of teaching staff to "turn away in shame" when the tipping screen is shown needs to go to some sort of gulag.
- marcellus23 1y ago
  > and at MOST 5% on take out Why would you ever tip on take out? What are you tipping for exactly?
  - IncreasePosts 1y ago
    The people who cooked the food
    - marcellus23 1y ago
      Tipping is for personal service. Does the kitchen even receive any of the tip if you tip for takeout? I figured it would just go to the person who hands you the food. After all, if you dine in, the tip doesn't go to the kitchen.
KurSix 1y ago
The most galling part is how the industry manages to manufacture worker consent through PR spin and management plants in hearings
voidUpdate 1y ago
What confuses me most is when you are given the option to give a tip before any service has been given. On deliveroo, for example, I have the option to tip the driver while I'm at the checkout. Why would I give a reward for good service when I have no idea if the service is even good? There's already a rider fee as part of my bill, so it doesn't make any sense to me to give them more money at that point
- bongripper 1y ago
  [dead]
- jama211 1y ago
  They’re just saying the quiet part out loud, the tip isn’t for service, it’s for their basic wage.
- viraptor 1y ago
  That's bad, but even worse is the Bluetti website, which asks you for a service tip FOR AN ONLINE ORDER!
  - gosub100 1y ago
    I started using Fiverr for outsourcing some tasks and they push you to tip after the transaction.
- xiphias2 1y ago
  It might be a way for them to prioritize your order before others as they see how much money they earn, so actually it's a bidding process disguised as tipping. I'm not sure if it's shown in the backend though, but I have seen things like this in other delivery apps.
  - technothrasher 1y ago
    Why would they prioritize you when you've already paid? Wouldn't they first go after the possibility of more tip money on jobs that haven't yet paid it? I mean, if I was a driver, unless there are more high tip jobs than I could handle, I'd take those and fill in with low tip jobs, and I'd deliver the low tip jobs first in a hope of getting an after the fact tip.
hacker_type 1y ago
[dead]
neuroelectron 1y ago
Trump is clearly the most powerful president of all time, and he basically controls everything.
shazbotter 1y ago
You know what would actually help workers in tipped positions? Going after wage theft. Taxes on tips are a drop in the bucket compared to wage theft.
cherryteastain 1y ago
Doesn't this also open a huge opportunity for tax evasion? Say I am a small business owner selling a $90 item which is $100 with state sales taxes. I say if you are willing to tip me at least $90, the item is $1. The buyer saves $9 from state sales taxes, and I save on income taxes because tips are exempt from tax.
- codegrappler 1y ago
  The law accounts for this. Jobs and industries that previously and traditionally don’t work on tips cannot convert to a method you describe.
- wat10000 1y ago
  I’m not sure if this is meaningfully different from offering a cash discount because you evade taxes on cash transactions.
  - Ylpertnodi 1y ago
    And EMV fees.
- jameshart 1y ago
  Yes, this rarely seems to come up in discussions of restaurant tipping culture in the US but especially given that a lot of municipalities have additional hospitality or food and beverage taxes over and above sales tax, there’s a strong incentive to keep menu prices low by encouraging tipping, as a way to minimize the taxable portion of the bill. If I need to make sure a server earns $200 after tax for a shift in order to be able to attract them to work for me, it is definitely to my advantage for as much of that money as possible to come directly from the customer as tips.
ajsnigrutin 1y ago
I never understood tips... You have a farmer that grows/raises food, butchers and others that 'process' it, you have a team of cooks who prepare/cook the food, and you're supposed to tip the the person who just brings the foor from the kitchen to your table, maybe 20, 30 meters away?! Sadly, tipping is sprading all over europe too with POS terminals bothering you more and more often for tips.
- rkomorn 1y ago
  I grew up in France and tipping in restaurants was definitely a thing, albeit on an entirely different scale than in the US. Leaving a few francs (I'm not young) was common practice. With cash payments growing more rare, and without the ability to tip easily with cards, maybe it became much less common. That said, I don't disagree with your comment on how it's spreading. What I don't love about the terminals asking for tips is that, IMO, it creates an expectation of tipping that wasn't there before. Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant. On the other hand, we regularly eat out at a place near us that only takes cash. We usually spend about 18€ and I always leave the extra 2€ as a tip.
  - tiagod 1y ago
    >Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant. I've lived in Portugal for 30 years and I never had that happen to me. Where are you seeing this? I could only imagine it in a place that only serves tourists and foreigners.
    - rkomorn 1y ago
      > I could only imagine it in a place that only serves tourists and foreigners. Maybe not "only", but yes, they're typically Americanized brunch places, or other "trendy" places. And some of those places have good food worth eating. It's still a pretty rare thing, fortunately. Something less offensive that I'm running into more often is to be asked if we want to leave a tip. And more common still are PoS systems that give you the option on checkout. Probably not the thread to digress into what's happening to dining in Lisbon (eg the rameniffication of everything) but it's definitely bringing in a more tip-forward mindset.
blitzar 1y ago
Stonk grants and options are tips too - no tax thanks.
bobwell 1y ago
For example, Amazon caught lowering delivery driver pay with the tips making up the difference and then lying about it: https://www.ftc.gov/system/files/documents/cases/amazon_flex_complaint.pdf https://www.ftc.gov/system/files/documents/cases/amazon_flex... > At the outset of the Amazon Flex program, from 2015 through late 2016, Amazon paid drivers at least $18 per hour plus 100% of customer tips > Beginning in late 2016 ... Amazon secretly reduced its own contribution to drivers’ pay to an algorithmically set, internal “base rate” using data it collected about average tips in the area ... > For example, for a one-hour block offering $18-$25, if Amazon’s base rate in the particular location was $12, and the customer left a $6 tip for the driver, then Amazon paid the driver only $12 and used the full customer tip of $6 to reach its minimum payment of $18 to the driver. And their punishment was just to pay back what had been taken: I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.
- aprilthird2021 1y ago
  > I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back. There was a very famous viral video of a woman stealing offering to just pay for the goods when she was caught, but we all understood why that was a ridiculous idea. Maybe she was just an Amazon VP, so she didn't know any better
- genericuser256 1y ago
  In this case[0] the CEO (Chris Kirchner) stole ~20M$ from the company causing employees to go unpaid for months, and outside of California all they got was owed wages (no interest or anything). While mentioned in the article, what he was mainly convicted of was defrauding investors rather than stealing from employees. > Apparently, projecting personal prosperity was more important to him than making payroll He actually had the temerity early on in the debacle when he was still pretending there was money to tell us that they had decided to not pay us that week because it would be bad for the companies investments to withdraw funds then. [0] https://www.justice.gov/usao-ndtx/pr/slync-founder-sentenced-20-years-federal-prison-fraud https://www.justice.gov/usao-ndtx/pr/slync-founder-sentenced...
- 1y ago
hnarn 1y ago
I’d honestly like to hear from someone who is a proponent of tipping how they think it makes any sense. By that I don’t mean I need the reason for tipping explained to my, everybody understands the argument for why you should tip: but how does it make sense when you consider who you tip and who you don’t?
- cestith 1y ago
  Do you understand the part about how the tipped minimum wage being so much lower was born largely out of racism?
  - hnarn 1y ago
    Even if that's true, what does that have to do with anything?
trhway 1y ago
It is interesting that the no tax on tips would expire in 2028, while the tax breaks, most affecting the wealthy, were made permanent in the same bill. A bit of political game i'd say.
- axus 1y ago
  Also, "The maximum annual deduction is $25,000 for individuals." Taxes are still being assessed, and tips over $500 a week won't have their tax refunded. Some rhetoric during BBB debate was a side effect of a similar political game; cuts for "middle class" in the Tax Cuts and Jobs act from 8 years ago were due to expire, benefits for corporations were not.
bearl 1y ago
Two steps short of legal prostitution. Maybe the worst idea from the administration so far. Time to build the app…
deadbabe 1y ago
I’ve finally eliminated all tipping in my life for anything that isn’t sit down restaurant service or an uber ride, and I’ve stopped using delivery apps to instead just pick up food myself. At first it feels shitty hitting 0 or “no tip” on a payment machine but after the first several times it feels empowering and I doubt employees give a shit anyway. Just do it.
imchillyb 1y ago
Bribing a driver in order to receive an order accurately seems archaic. I’ll drive there myself, thanks. My pup gets a ride. The apps get the finger. The drivers get what they deserve. Wins all around.
gchamonlive 1y ago
Tips are the most cynical thing I've ever seen. Tips are supposed to be "in return for a service, beyond the compensation agreed on" (WordsAPI). If tips instead mean "it's something you have to give when you had no problems with the service provided", and you expect routinely not to have problems with such service providers, then it's implicitly agreed that tips are required, so they are not tips anymore.
paulwilsondev 1y ago
this is why we need to end this ridiculous tipping culture
paulwilsondev 1y ago
I never put a tip in at a kiosk.
rayiner 1y ago
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.
jollyllama 1y ago
Tax on real tips i.e. cash was already unenforceable, but perhaps it's nice to codify it. Then again, it feels like just another step to shift transactions away from cash.
gorkish 1y ago
All this is just the result of playing a zero sum game with industry that is traditionally very low margin. The money always comes from somewhere.
rayiner 1y ago
> But, when three members of the group came forward to testify, all expressed support for the Tipped Workers Protection Act and opposition to the One Fair Wage Act, which they portrayed as an effort to steal their tips This article is missing a real issue here by trying to make the story all about the employers. Many workers like the tip system because it creates inequality among the restaurant workers. Good servers can earn a lot more money than what they’d earn if every server were paid the same, fair wage. My mom used to work at a furniture store as a floor sales associate on commission. She would regularly clear $120,000/year (this was 15 years ago, so like $180,000 today). A generous wage for the job at the time probably would’ve been $50,000 or so. She would’ve fought such a policy tooth and nail.
- saurik 1y ago
  Some people always like the status quo: no bloc is 100% consistent. With numbers like what you provide, though, this would be a minority of affected people... though, the ones with the most money to lobby.
  - deleted 1y ago
    [deleted]
- amosslade 1y ago
  >creates inequality Did you mean that it rewards them for their efforts?
  - edmundsauto 1y ago
    For food service, specifically waiting tables - how much of the tip is because of effort and better service - and how much is due to the attractiveness and general demographic characteristics of the server?
    - s1artibartfast 1y ago
      Good question. I would say mostly the former. I imagine you might say the latter.
amosslade 1y ago
My daughter works at a mid-tier restaurant 35 hours a week and makes more than my wife who is a math teacher, department head, and has many years of teaching experience. Eliminating tips and increasing the base wage is a stupid idea. All the talented servers who love the job will leave and mediocre people will replace them.
- bigstrat2003 1y ago
  Having no required tips and a higher base wage works just fine in other countries. I think you're overstating your case.
  - deleted 1y ago
    [deleted]
- IncreasePosts 1y ago
  What exactly are they going to leave for? What well paying skills is your daughter not putting to use so that she can help people get food?
- insane_dreamer 1y ago
  except that most people -- including me -- hate it raise prices by 20% and drop "mandatory" tips which is what they have become then tipping can go back to what it was -- optional extra to reward excellent service, not an unspoken part of the bill
cafp12 1y ago
Why don't yall ask the tipped workers if they are happy or upset about having no tax on tips?
- altcognito 1y ago
  "Y'all" would be pretty silly to ask a question of little relevance. Why wouldn't I ask them whether they were happy with their overall compensation, including health benefits, retirement, hours being scheduled, vacation or sick time. Should I ask those in the back who may or may not be getting the tips from the table?
phyzix5761 1y ago
I, personally, believe tipping is detrimental because it encourages preferential treatment. When workers know someone is a generous tipper, they often provide better service to that person than to others who tip more modestly. In many cases, tipping functions like a form of bribery, incentivizing employees to offer favors or services beyond what is appropriate, which can come at the employer's expense. It can also create resentment toward customers who don't tip, leading workers to offer poor service and fall short in their duties.
hshdhdhj4444 1y ago
Fascinating how America’s response to people being sick of having to tip on everything, tips being little more than a tax on generosity, was to make this most hated form of remuneration even more advantageous.
- slumberlust 1y ago
  That's because the business benefits from it the most.
- jiscariot 1y ago
  Agreed 100%. I will enjoy the creative financial engineering that likely comes with this policy, as we attempt to classify more and more things as gratuity, to escape the reach of the IRS.
- lotsoweiners 1y ago
  Since this was passed I just decided to reduce my standard tips from 20% back down to 15%. Figure it works itself out that way.
righthand 1y ago
Yeah we just had to sell out medicare, bomb Iran, destroy USAID, and now restaurant workers can blame the public more for their thief employers not paying them a living wage. I have happily nearly eliminated eating out partially because tipping has become ridiculous but restaurant prices are still very high post-pandemic. Fuck tipping.
pmontra 1y ago
> "we are going to not charge taxes on tips" It's been a very long time since my last visit to the USA. I probably paid tips in cash back then. I would assume that workers can chose to never report those tips as income, or not all of them, so no taxes. But if everybody went cashless by now, customers probably pay the restaurant, the restaurant pays the tips to the workers and all of that money is tracked and taxed. Is that correct?
- anamexis 1y ago
  Yes, that is correct.
- milesskorpen 1y ago
  yes
- deleted 1y ago
  [deleted]
alphazard 1y ago
It's fascinating to see the correlation in opinion between taxing tips and raising the minimum wage. If the prevailing sentiment was to make things easier for low income workers, I would expect people to want to not tax tips, and increase the minimum wage. And people who want less government interference, would want less tax, and lower minimum wage. Those are the two opinions I expected to see. But instead it seems like people want to tax tips, and increase the minimum wage, which is evidence of a kind of authoritarianism that I did not expect.
- danudey 1y ago
  Tips are still income. If we increase the minimum wage so that people can afford to live then I can't see any reason why we wouldn't tax tips also. If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. A better solution would be to prevent restaurants from paying their people poverty wages, and if servers aren't risking starvation and homelessness if they go without tips for a week then why would you not include their tips in their regular income? Raise the minimum wage, require servers to be paid minimum wage, and enforce a straightforward tax on people's income that doesn't distinguish wage from tips. Maybe also increase the 0% tax bracket to something more reasonable, like $20-40k, just to simplify things for people who are struggling to subsist while we're at it.
  - 9rx 1y ago
    > require servers to be paid minimum wage There is no jurisdiction in the US that allows servers to be paid less than the standard minimum wage. Even where you find server minimum wages (your $2.50/hr example, although not all states allow this) the employer is required to top up to the standard minimum wage if tips don't cover the difference. Which makes this kind of silly, > If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. If $2.50/hr + tips exceeds minimum wage, why do you need a special break? You're making more than other minimum wage workers. If $2.50/hr + tips does not add up to minimum wage, the employer has to get you to minimum wage, so you are making no less than someone else making minimum wage. If people with low income need a break, just give people with low income a break. How that low income is derived is irrelevant.
WaitWaitWha 1y ago
Just a historical note as a consolidated response to those who identify 'tipping' as an 16th through 20th century invention. This is incorrect as humans had 'tipping' all the way back to earliest recorded times. In the middle ages vails or informal rewards were given to well performing servants. In the Roman times corollarium (Lucilius, Seneca), a form of tipping was known. Cicero referred to tipping as stipen although some argue that is not above regular pay. There are some evidence that in the Han Dynasty, gifts were bestowed on well performing eunuchs, above their normal pay. Considering that in ancient times payments often were in non-monetary compensation, this could be considered a progenitor of tipping. Incas had similar systems of rewarding service with goods like cloth, though not exactly like modern tipping. Tipping, as we understand it today, likely did not exist in the same form in ancient civilizations, but there were practices where extra gifts or payments were given for exceptional service. > What has been will be again, what has been done will be done again; there is nothing new under the sun.

It's also a joke, because anyone who's worked a service job knows there is no tax on cash tips (wink!)

deleted 1y ago
[deleted]
garciasn 1y ago
I have an honest question: what's the cash vs card tip ratio? 99.999% of the time I am not carrying cash and I don't see many (any?) people paying with cash ANYWHERE in the last 10+ years.
- joshstrange 1y ago
  Almost no one can give you a good answer because it varies by business type and location. My business does not involve tips (exactly) but I can tell you that I’ve seen anywhere from 20-40% of money run through my system being in cash, depending on where I am in the country.
- lelandfe 1y ago
  NYC here, whole lot of cash still showing up in tip jars - there are still and loads of cash-only places around, from bars, restaurants, to street carts, you name it. JG Melon, for instance, is famously cash only. But so too is the bar around the corner from my apartment (Dynaco, do recommend). ...So people often tend to be carrying cash still.
  - kelnos 1y ago
    Sure, but more places take card, and fewer people carry as much cash. Or rather, people carry less cash. The fact that a business "famously" is cash only seems to support this, as that implies that it's becoming more unusual.
    - lelandfe 1y ago
      It’s certainly unusual for a famous restaurant to not accept cards. Everything else is a crapshoot. If you don’t have cash you aren’t getting dumplings in Chinatown. And that’s just a bummer!
- Workaccount2 1y ago
  At this point you are litterally a sucker to pay for anything in cash, because everything is marked-up to cover CC fees, which you get a portion of back in the form of rewards. Yes, I know some places give cash discounts. Most do not.
  - godelski 1y ago
    I pay tips in cash. There's technically no CC fees on that.
  - frollogaston 1y ago
    Not everything is marked up to cover CC fees, and any time there's a CC surcharge, it's more than the points you get. That and the tip is separate.
    - kelnos 1y ago
      As the GP said, most places do not give a cash discount (the equivalent of a CC surcharge), though that practice is indeed a bit more common than it was a decade ago. Interestingly, I've see this practice in odd places like my utility and phone bills (they don't charge an extra fee if you instead link your bank account or use a debit card, which I don't love, but... here we are). And even if things aren't marked up to cover CC fees, if you have a rewards card, you're effectively paying more if you pay in cash.
      - frollogaston 1y ago
        Idk. Where I live, it's very common. Almost every gas station does it, about half the restaurants, and yes every utility. 0 grocery stores though. The fee is at least 3%, and no card offers that level of cashback, though you might be able to do the equivalent of 5% with airline miles. Cardholder agreements used to disallow CC surcharges, but I think such clauses were outlawed.
    - deleted 1y ago
      [deleted]
- littlexsparkee 1y ago
  in SF I only carry cash for dive bars and the occasional mom n pop diner
WorkerBee28474 1y ago
Sounds like those Americans aren't paying their fair share.
- bigyabai 1y ago
  The negligence of their national responsibility will be felt like an earthquake by millions of Americans. It's hard to imagine how they live with themselves.
crazygringo 1y ago
Which made a difference 2 or 3 decades ago. But today, who's getting tips in cash? Not many. Customers are paying for everything with credit cards or contactless, save for the occasional cash-only coffee shop or restaurant.
- bigyabai 1y ago
  I should have specified that I live in the east-coast United States. Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.
  - deleted 1y ago
    [deleted]
  - kccqzy 1y ago
    Saying east coast is too vague to be useful. I live on the east coast too and there are entire weeks where leave all my credit cards at home and only pay via tap-to-pay.
  - hdgvhicv 1y ago
    Contactless is basically non existent in America? I know America has always been backwards (cheques were still in use well into the 21st century, card pins didn’t seem to catch on before contactless became a thing about a decade ago), but I thought contactless was quite high nowadays, especiallly with phones and watches. Certainly I’ve had no problem paying contactless in the cities I’ve been to recently - New York, DC and Miami.
    - tallanvor 1y ago
      Keep in mind that inertia is a thing. Businesses used to have to make an impression on your card on carbon copy paper and physically send the slips in to be processed. When they started swiping cards, restaurants would only have one terminal and it had to be connected to a phone line to work. Both of these situations made it common for you to hand your card to the waiter (usually in the book they brought the check) because they couldn't do it at the table. Credit cards caught on later in other parts of the world, and they benefited from having more modern options with regards to the equipment used. Governments and banks also did more to mandate the use of security features (chip & pin) than in the US - American banks like people using credit cards - it makes them a lot of money and they're incentivized to keep the barriers low as long as the amount of fraud is manageable to them.
sundaeofshock 1y ago
When I worked as a waiter (many years ago), my pay check included tax withholding based on 8% of my tables for that pay period. This is driven by IRS rules: https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total%20tips%20reported,to%20whom%20you%20allocated%20tips. https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total...
- JamesSwift 1y ago
  We had to declare our tips at the end of the night, and 10% was the lowest you could claim without needing manager approval. You can guess what everyone declared.
JamesSwift 1y ago
Haha, I had the same thought but now basically everyone is digital so I think its a different ball game than we are used to. At least as a restaurant server/bartender.

Some interesting points: ~40% of tipped workers don't make enough to get taxed anyway, no tax on tips would actually advantage better paid workers like casino dealers who don't need the help. NToT is described as a campaign to distract from minimum wage increase initiatives.

toomuchtodo 1y ago
https://jacobin.com/2025/07/restaurant-industry-tipped-subminimum-wages/ https://jacobin.com/2025/07/restaurant-industry-tipped-submi... https://jacobin.com/2020/10/tipped-restaurant-workers-waiters-coronavirus-subminimum-wage https://jacobin.com/2020/10/tipped-restaurant-workers-waiter... https://cepr.net/publications/customer-tips-are-providing-the-lions-share-of-wages-to-tipped-workers/ https://cepr.net/publications/customer-tips-are-providing-th...
- Aloisius 1y ago
  I live in California and this isn't true here. All restaurant workers receive at least minimum wage before tips. In my city, that's $19/hour with health insurance. Of course, you're still expected to leave a tip and suggested minimum is now 20%, plus even McDonalds is charging $15 for a 4 oz burger, so I rarely go out to eat at places that expect a tip anymore. I'm not sure why they specifically should be tax exempt though. Cash tips often were, practically speaking, so a lot of tax evasion was happening, but it still seems odd to single them out.
  - msikora 1y ago
    California doesn't have a special minimum wage for tipped professions? When I was waiting tables a long time ago I think my pay was $1.95 an hour. It was usually just enough to cover tax on tips (the ones we admitted).
    - Aloisius 1y ago
      Nope. Tipped workers are paid full minimum wage in California.

analog31 1y ago

How about the tips that I get as a musician?

cammikebrown 1y ago
Do you report them?
- analog31 1y ago
  Of course.
Workaccount2 1y ago
The IRS is going to publish a list of eligible occupations by years end.
- beefnugs 1y ago
  like being president, and getting crypto tips from supportersuckers
  - ourmandave 1y ago
    It's amazing how the Saudis managed to fit a 747 into a tip jar.
    - optimalsolver 1y ago
      I think that was Qatar.
    - potato3732842 1y ago
      You have to give them credit for the biblical metaphor.
  - analog31 1y ago
    There will be a separate bill for emoluments.

111111IIIIIII 1y ago

[dead]

steveBK123 1y ago

All bonuses soon to be labelled as tips.

limagnolia 1y ago
This is unlikely to be allowed, the last I checked, the law explicitly only allows "traditionally tipped jobs". How it gets interpreted and implemented in IRS Tax Code isn't clear yet, but they will probably have rules in place to prevent this. Doesn't change the fact that it is a terrible idea.
- hirvi74 1y ago
  Hmm, this makes me wonder though -- I have noticed various projects on Github and various other sites allow for users and fans of projects to donate to the developers and maintainers. Who hasn't seen the "wanna buy me a coffee?" button on a site before? I am not sure if the money from such sources was ever taxed as income, but if so, then I wonder if such will be non-taxable now? Considering donation and tip buttons have some history behind them, perhaps such "jobs" could be considered "traditionally tipped jobs?"
  - atomicnumber3 1y ago
    Technically that money should be reported on a 1099 misc. but is it generally enough to even have an auditor look at it? I'd guess not. But you do technically need to.
  - dml2135 1y ago
    They will publish a list > (h) Published List of Occupations Traditionally Receiving Tips.-- Not later than 90 days after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary's delegate) shall publish a list of occupations which customarily and regularly received tips on or before December 31, 2024, for purposes of section 224(d)(1) of the Internal Revenue Code of 1986 (as added by subsection (a)).
onlyrealcuzzo 1y ago

siliconc0w 1y ago

"No tax of tips" is one of the most brilliant political ploys ever. You really gotta give Trump credit. It doesn't really cost anything, businesses love it, and you can trot it out as a victory for the working class while you screw them on their health care or energy costs.

Workaccount2 1y ago
Trump is a populist president. People just don't recognize it because right-wing populism is a different breed than left-wing populism (the only one they have had exposure to). Tariffs are a populist move as well. If you go look at Bernie's old website (pre-trump) he has a whole section about the importance of tariffs.
Bukhmanizer 1y ago
It’s not really, it’s the kind of thing that only a populist could do. If a Democrat did this, people would hate it for this very reason. This would just another “NeoLib” concoction to screw the working class.
frollogaston 1y ago
Idk, tipping expectation is really unpopular, and anyone can see how this feeds it.

Larrikin 1y ago

Don't forget to reduce your tips by the percentage they were previously being taxed, since it is all charity anyway. Hopefully this becomes another straw that will eventually break the camels back and we get rid of tipping all together. Every restaurant in the world does not need tips to survive, except for the ones in the US.

toomuchtodo 1y ago
Tips subsidize profits, plain and simple. But, America runs on poverty, so this is in line with the broader socioeconomic strategy.
- 9rx 1y ago
  > 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 theoretically great as it sounds, you are ultimately beholden to what the customer wants. There is good reason why every restaurant that has tried a "no tips" policy has failed. Nobody shows up to dine. They go somewhere else where they can tip instead. Regular people actually enjoy tipping, as hard as it may be to believe for those who are staring at screens rather than enjoying the ambiance of a restaurant.
  - hdgvhicv 1y ago
    Why do you take a fixed profit. Why don’t you charge the amount which maximises profit?
    - 9rx 1y ago
      Because x% is the maximum profit. Not even places like Walmart, for all their might, have figured out how to exceed the same x% (somewhere around 2-3%).
  - 1y ago

godelski 1y ago

I think with any conversation about tips it is really important to recognize that laws vary dramatically across states[0]. I think talking about this can really drive at the real underlying issues with tipping. IMO most discussions about tipping are a distraction. "Divide and rule" if you will. == THE LAW == (or my best understanding. IANAL) For most of the west coast (AK, CA, OR, WA): there is no separate "tipping wage". Tips are *always* on top of *at least* state minimum wage. There is only one minimum wage, so tipping is always a "bonus". Other places, there are two "minimum wages", but that's confusing because at the end every employee has to make at least the normal minimum wage. The difference is that employers can use tips as credit against this. So, with the exception of Georgia (WTF GA!), employees *must* make the state's minimum wage (default federal). Using federal (min wage = $7.25) an employer *MUST* pay you *no less than* $2.13/hr. This is conditioned that you have made *at least* $5.12/hr in tips. The problem here is what tips count to what wages. Per day? Per week? Per paycheck? DOL says "workweek"[1] ============ So the real (main) problem is actually just straight up good old wage theft. Anyone who is not getting at least minimum wage is suffering from wage theft. I've heard stories of employees not getting a paycheck "because employer thought it was all tips" (illegal b/c they credited too much) or very small paychecks with the explanation that the employer over-credited tips. There's at least a decently straight-forward way to show what can be credited, and this is why there's the tip amount that you log. Ignoring cameras, the burden is on the employer to prove that they can make these credits, so that line-item on the bill is important (IANAL) Personally: I think the entire discussion of tipping often only serves as a distraction to wage. Like there's a lot of person to person fighting of how much we should tip (including not tipping) and frankly, doesn't this discussion often boil down to wage theft? I mean ignoring the already illegal problem of wage theft, what makes a server (who gets tipped) any different from a cashier (who doesn't get tipped) as an employee. Their jobs differ in duties, but we're talking about wage and *fair pay* here. If all the laws are followed, a tipped employee strictly benefits from tips. They have a statistical wage but that wage is max(base_pay, state_minimum) + random_value. So I think 90% of discussions around tipping end up just being a distraction to create a fictitious divide of "minimum wage workers" vs "tipped workers"[2] who should instead be working as a coalition to increase the floor. They are both minimum wage earners! The main difference is primarily that tipped employees are just more likely to suffer from wage theft, due to how they are paid. But that's also something that both experience, just at different rates. TLDR: Getting rid of tips as a concept is a simple solution to the wage theft problem, but isn't the real problem just good old fashion wage theft? (second problem being "is minimum wage minimum"?) [0] https://www.dol.gov/agencies/whd/state/minimum-wage/tipped https://www.dol.gov/agencies/whd/state/minimum-wage/tipped [1] https://www.dol.gov/agencies/whd/fact-sheets/15-tipped-employees-flsa https://www.dol.gov/agencies/whd/fact-sheets/15-tipped-emplo... [2] Simplifying by ignoring tipped earners with higher than min wage base pay (we can extend as needed)

david38 1y ago

How is an expected tip different from a commission other than who pays? This is rather brilliant. * make it look like the government is stealing “gifted” money * stop taxing it * turn as many jobs as possible into tipped jobs supposedly for the person’s benefit * really the employer wins since they’ll pay less and claim “tips”

andreareina 1y ago

https://archive.is/20250731232051/https://www.newyorker.com/magazine/2025/08/04/no-tax-on-tips-is-an-industry-plant https://archive.is/20250731232051/https://www.newyorker.com/...

Simulacra 1y ago

I worked as a server for about a year in college, and when we would check out at the end of the night, literally, everyone would just put zero. As in they didn't earn anything. Every time. I'm sure it mess with the taxes in someway or another.

evo_9 1y ago

According to my accountant for my wife’s small business (nail and wax salon) this tax law change will have a significant positive impact on her staff. Not sure what to make of this article, it seems pretty disingenuous.

kelnos 1y ago
N=1. Just because your wife's business doesn't fall under the conditions that the article is talking about, it doesn't mean that her business is the norm.
- evo_9 1y ago
  Sure, my experience isn’t with sharing, basically. Nice.
aprilthird2021 1y ago
I'm just planning on tipping less to make up for it. In California minimum wages are already $20/hr, and on top of that so many places expect a higher %ge, tip, just cutting my tip by the 10% they pay in tax and being done with it. I pay taxes on my wages. They should too

oellegaard 1y ago

It’s crazy that this still happens in the US. Tipping is a thing of the past. Pay for your meal and have the restaurant pay their people for their work. End of story.

efitz 1y ago
There’s very little empirical evidence correlating tipping with better service.
- frollogaston 1y ago
  No, they're definitely more attentive for the tip, I just don't like it. If they're going to be extra nice, I don't want it to be for money. Felt nice going to other countries like Australia where the customer isn't always right but they still do their jobs.
  - ecb_penguin 1y ago
    Bud, literally nobody gives a shit about waiting on you. They are literally only doing it for the money. People in Australia are still doing it for the money, even if you don't realize it.
    - ghiculescu 1y ago
      As an Australian who lived in America for 5 years - it’s bonkers to claim the service is better (or even as good) in Aus. It’s clearly more attentive in the states, anyone who says otherwise has an agenda. Sometimes you don’t want good service - as in, you don’t want a server to talk to you. That’s a lot easier to find here.
      - frollogaston 1y ago
        Yeah, this exactly matches my experience visiting Sydney from the US, it was great. I'm not antisocial, in fact I enjoy talking to strangers, but it feels very wrong to pay them for it.

ojbyrne 1y ago

“No Tax on Overtime” ditto. As I understand it if it’s overtime negotiated through a union contract, you’re out of luck.

photios 1y ago

I don't like tipping as much as the next guy, but this isn't about that. It's about government overreach and privacy. Governments tracking small transactions like tips and taxing them should bother everyone. That rag, the New Yorker, knows that of course.

thuridas 1y ago

Aren't we creating incentives for workers abuse: - No tax on overtime: so now making them work 60 hours a week is cheaper for the employer - No tax on tips: so the tip based payment model is cheaper

entropi 1y ago
Yes, and my understanding is that this is precisely the point.
ghiculescu 1y ago
How is it cheaper for the employer?
- gog 1y ago
  For the same amount of money employee gets it requires employer to pay out less.
  - ghiculescu 1y ago
    That’s not how income tax works, particularly for minimum wage workers.
    - RobinL 1y ago
      It's just supply and demand. It makes working in these industries relatively more attractive, increasing supply of labour and therefore reducing price of labour. So restaurant owners capture some of the benefits
      - ghiculescu 1y ago
        So employees earn more, and restaurants spend less. And this is bad because?
        RobinL 1y ago

augment_me 1y ago

I can kind of see the average traditional service work position to shift into a Uber-esque model where you are a essentially a gig contractor. The worker takes the full risk for slow days, and the business owner does not have to pay you a salary, as everything comes from the customer.

alkonaut 1y ago
That’s exactly what US waiter employment is. And it needs to die.

floppiplopp 1y ago

[flagged]

SSchick 1y ago

My tips have been going down progressively, when I moved to the US I was taught 20% is "normal", now I tip 15% at MOST at restaurants and at MOST 5% on take out. I'm tired of being shamed to pay more for less. Also whoever was in charge of teaching staff to "turn away in shame" when the tipping screen is shown needs to go to some sort of gulag.

marcellus23 1y ago
> and at MOST 5% on take out Why would you ever tip on take out? What are you tipping for exactly?
- IncreasePosts 1y ago
  The people who cooked the food
  - marcellus23 1y ago
    Tipping is for personal service. Does the kitchen even receive any of the tip if you tip for takeout? I figured it would just go to the person who hands you the food. After all, if you dine in, the tip doesn't go to the kitchen.

KurSix 1y ago

The most galling part is how the industry manages to manufacture worker consent through PR spin and management plants in hearings

voidUpdate 1y ago

What confuses me most is when you are given the option to give a tip before any service has been given. On deliveroo, for example, I have the option to tip the driver while I'm at the checkout. Why would I give a reward for good service when I have no idea if the service is even good? There's already a rider fee as part of my bill, so it doesn't make any sense to me to give them more money at that point

bongripper 1y ago
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jama211 1y ago
They’re just saying the quiet part out loud, the tip isn’t for service, it’s for their basic wage.
viraptor 1y ago
That's bad, but even worse is the Bluetti website, which asks you for a service tip FOR AN ONLINE ORDER!
- gosub100 1y ago
  I started using Fiverr for outsourcing some tasks and they push you to tip after the transaction.
xiphias2 1y ago
It might be a way for them to prioritize your order before others as they see how much money they earn, so actually it's a bidding process disguised as tipping. I'm not sure if it's shown in the backend though, but I have seen things like this in other delivery apps.
- technothrasher 1y ago
  Why would they prioritize you when you've already paid? Wouldn't they first go after the possibility of more tip money on jobs that haven't yet paid it? I mean, if I was a driver, unless there are more high tip jobs than I could handle, I'd take those and fill in with low tip jobs, and I'd deliver the low tip jobs first in a hope of getting an after the fact tip.

hacker_type 1y ago

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neuroelectron 1y ago

Trump is clearly the most powerful president of all time, and he basically controls everything.

shazbotter 1y ago

You know what would actually help workers in tipped positions? Going after wage theft. Taxes on tips are a drop in the bucket compared to wage theft.

cherryteastain 1y ago

Doesn't this also open a huge opportunity for tax evasion? Say I am a small business owner selling a $90 item which is $100 with state sales taxes. I say if you are willing to tip me at least $90, the item is $1. The buyer saves $9 from state sales taxes, and I save on income taxes because tips are exempt from tax.

codegrappler 1y ago
The law accounts for this. Jobs and industries that previously and traditionally don’t work on tips cannot convert to a method you describe.
wat10000 1y ago
I’m not sure if this is meaningfully different from offering a cash discount because you evade taxes on cash transactions.
- Ylpertnodi 1y ago
  And EMV fees.
jameshart 1y ago
Yes, this rarely seems to come up in discussions of restaurant tipping culture in the US but especially given that a lot of municipalities have additional hospitality or food and beverage taxes over and above sales tax, there’s a strong incentive to keep menu prices low by encouraging tipping, as a way to minimize the taxable portion of the bill. If I need to make sure a server earns $200 after tax for a shift in order to be able to attract them to work for me, it is definitely to my advantage for as much of that money as possible to come directly from the customer as tips.

ajsnigrutin 1y ago

I never understood tips... You have a farmer that grows/raises food, butchers and others that 'process' it, you have a team of cooks who prepare/cook the food, and you're supposed to tip the the person who just brings the foor from the kitchen to your table, maybe 20, 30 meters away?! Sadly, tipping is sprading all over europe too with POS terminals bothering you more and more often for tips.

rkomorn 1y ago
I grew up in France and tipping in restaurants was definitely a thing, albeit on an entirely different scale than in the US. Leaving a few francs (I'm not young) was common practice. With cash payments growing more rare, and without the ability to tip easily with cards, maybe it became much less common. That said, I don't disagree with your comment on how it's spreading. What I don't love about the terminals asking for tips is that, IMO, it creates an expectation of tipping that wasn't there before. Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant. On the other hand, we regularly eat out at a place near us that only takes cash. We usually spend about 18€ and I always leave the extra 2€ as a tip.
- tiagod 1y ago
  >Now, in Portugal, we're starting to see cases of "here's the price with a 3€ tip (for example), if you want to pay that", and you awkwardly get to say "no thanks I want to pay the actual price", which I find very unpleasant. I've lived in Portugal for 30 years and I never had that happen to me. Where are you seeing this? I could only imagine it in a place that only serves tourists and foreigners.
  - rkomorn 1y ago
    > I could only imagine it in a place that only serves tourists and foreigners. Maybe not "only", but yes, they're typically Americanized brunch places, or other "trendy" places. And some of those places have good food worth eating. It's still a pretty rare thing, fortunately. Something less offensive that I'm running into more often is to be asked if we want to leave a tip. And more common still are PoS systems that give you the option on checkout. Probably not the thread to digress into what's happening to dining in Lisbon (eg the rameniffication of everything) but it's definitely bringing in a more tip-forward mindset.

blitzar 1y ago

Stonk grants and options are tips too - no tax thanks.

bobwell 1y ago

For example, Amazon caught lowering delivery driver pay with the tips making up the difference and then lying about it: https://www.ftc.gov/system/files/documents/cases/amazon_flex_complaint.pdf https://www.ftc.gov/system/files/documents/cases/amazon_flex... > At the outset of the Amazon Flex program, from 2015 through late 2016, Amazon paid drivers at least $18 per hour plus 100% of customer tips > Beginning in late 2016 ... Amazon secretly reduced its own contribution to drivers’ pay to an algorithmically set, internal “base rate” using data it collected about average tips in the area ... > For example, for a one-hour block offering $18-$25, if Amazon’s base rate in the particular location was $12, and the customer left a $6 tip for the driver, then Amazon paid the driver only $12 and used the full customer tip of $6 to reach its minimum payment of $18 to the driver. And their punishment was just to pay back what had been taken: I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back.

aprilthird2021 1y ago
> I can't imagine there are many other opportunities to steal $61m with the only punishment when you're caught is having to pay it back. There was a very famous viral video of a woman stealing offering to just pay for the goods when she was caught, but we all understood why that was a ridiculous idea. Maybe she was just an Amazon VP, so she didn't know any better
genericuser256 1y ago
In this case[0] the CEO (Chris Kirchner) stole ~20M$ from the company causing employees to go unpaid for months, and outside of California all they got was owed wages (no interest or anything). While mentioned in the article, what he was mainly convicted of was defrauding investors rather than stealing from employees. > Apparently, projecting personal prosperity was more important to him than making payroll He actually had the temerity early on in the debacle when he was still pretending there was money to tell us that they had decided to not pay us that week because it would be bad for the companies investments to withdraw funds then. [0] https://www.justice.gov/usao-ndtx/pr/slync-founder-sentenced-20-years-federal-prison-fraud https://www.justice.gov/usao-ndtx/pr/slync-founder-sentenced...
1y ago

hnarn 1y ago

I’d honestly like to hear from someone who is a proponent of tipping how they think it makes any sense. By that I don’t mean I need the reason for tipping explained to my, everybody understands the argument for why you should tip: but how does it make sense when you consider who you tip and who you don’t?

cestith 1y ago
Do you understand the part about how the tipped minimum wage being so much lower was born largely out of racism?
- hnarn 1y ago
  Even if that's true, what does that have to do with anything?

trhway 1y ago

It is interesting that the no tax on tips would expire in 2028, while the tax breaks, most affecting the wealthy, were made permanent in the same bill. A bit of political game i'd say.

axus 1y ago
Also, "The maximum annual deduction is $25,000 for individuals." Taxes are still being assessed, and tips over $500 a week won't have their tax refunded. Some rhetoric during BBB debate was a side effect of a similar political game; cuts for "middle class" in the Tax Cuts and Jobs act from 8 years ago were due to expire, benefits for corporations were not.

bearl 1y ago

Two steps short of legal prostitution. Maybe the worst idea from the administration so far. Time to build the app…

deadbabe 1y ago

I’ve finally eliminated all tipping in my life for anything that isn’t sit down restaurant service or an uber ride, and I’ve stopped using delivery apps to instead just pick up food myself. At first it feels shitty hitting 0 or “no tip” on a payment machine but after the first several times it feels empowering and I doubt employees give a shit anyway. Just do it.

imchillyb 1y ago

Bribing a driver in order to receive an order accurately seems archaic. I’ll drive there myself, thanks. My pup gets a ride. The apps get the finger. The drivers get what they deserve. Wins all around.

gchamonlive 1y ago

Tips are the most cynical thing I've ever seen. Tips are supposed to be "in return for a service, beyond the compensation agreed on" (WordsAPI). If tips instead mean "it's something you have to give when you had no problems with the service provided", and you expect routinely not to have problems with such service providers, then it's implicitly agreed that tips are required, so they are not tips anymore.

paulwilsondev 1y ago

this is why we need to end this ridiculous tipping culture

paulwilsondev 1y ago

I never put a tip in at a kiosk.

rayiner 1y ago

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.

jollyllama 1y ago

Tax on real tips i.e. cash was already unenforceable, but perhaps it's nice to codify it. Then again, it feels like just another step to shift transactions away from cash.

gorkish 1y ago

All this is just the result of playing a zero sum game with industry that is traditionally very low margin. The money always comes from somewhere.

rayiner 1y ago

> But, when three members of the group came forward to testify, all expressed support for the Tipped Workers Protection Act and opposition to the One Fair Wage Act, which they portrayed as an effort to steal their tips This article is missing a real issue here by trying to make the story all about the employers. Many workers like the tip system because it creates inequality among the restaurant workers. Good servers can earn a lot more money than what they’d earn if every server were paid the same, fair wage. My mom used to work at a furniture store as a floor sales associate on commission. She would regularly clear $120,000/year (this was 15 years ago, so like $180,000 today). A generous wage for the job at the time probably would’ve been $50,000 or so. She would’ve fought such a policy tooth and nail.

saurik 1y ago
Some people always like the status quo: no bloc is 100% consistent. With numbers like what you provide, though, this would be a minority of affected people... though, the ones with the most money to lobby.
- deleted 1y ago
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amosslade 1y ago
>creates inequality Did you mean that it rewards them for their efforts?
- edmundsauto 1y ago
  For food service, specifically waiting tables - how much of the tip is because of effort and better service - and how much is due to the attractiveness and general demographic characteristics of the server?
  - s1artibartfast 1y ago
    Good question. I would say mostly the former. I imagine you might say the latter.

amosslade 1y ago

My daughter works at a mid-tier restaurant 35 hours a week and makes more than my wife who is a math teacher, department head, and has many years of teaching experience. Eliminating tips and increasing the base wage is a stupid idea. All the talented servers who love the job will leave and mediocre people will replace them.

bigstrat2003 1y ago
Having no required tips and a higher base wage works just fine in other countries. I think you're overstating your case.
- deleted 1y ago
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IncreasePosts 1y ago
What exactly are they going to leave for? What well paying skills is your daughter not putting to use so that she can help people get food?
insane_dreamer 1y ago
except that most people -- including me -- hate it raise prices by 20% and drop "mandatory" tips which is what they have become then tipping can go back to what it was -- optional extra to reward excellent service, not an unspoken part of the bill

cafp12 1y ago

Why don't yall ask the tipped workers if they are happy or upset about having no tax on tips?

altcognito 1y ago
"Y'all" would be pretty silly to ask a question of little relevance. Why wouldn't I ask them whether they were happy with their overall compensation, including health benefits, retirement, hours being scheduled, vacation or sick time. Should I ask those in the back who may or may not be getting the tips from the table?

phyzix5761 1y ago

I, personally, believe tipping is detrimental because it encourages preferential treatment. When workers know someone is a generous tipper, they often provide better service to that person than to others who tip more modestly. In many cases, tipping functions like a form of bribery, incentivizing employees to offer favors or services beyond what is appropriate, which can come at the employer's expense. It can also create resentment toward customers who don't tip, leading workers to offer poor service and fall short in their duties.

hshdhdhj4444 1y ago

Fascinating how America’s response to people being sick of having to tip on everything, tips being little more than a tax on generosity, was to make this most hated form of remuneration even more advantageous.

slumberlust 1y ago
That's because the business benefits from it the most.
jiscariot 1y ago
Agreed 100%. I will enjoy the creative financial engineering that likely comes with this policy, as we attempt to classify more and more things as gratuity, to escape the reach of the IRS.
lotsoweiners 1y ago
Since this was passed I just decided to reduce my standard tips from 20% back down to 15%. Figure it works itself out that way.

righthand 1y ago

Yeah we just had to sell out medicare, bomb Iran, destroy USAID, and now restaurant workers can blame the public more for their thief employers not paying them a living wage. I have happily nearly eliminated eating out partially because tipping has become ridiculous but restaurant prices are still very high post-pandemic. Fuck tipping.

pmontra 1y ago

> "we are going to not charge taxes on tips" It's been a very long time since my last visit to the USA. I probably paid tips in cash back then. I would assume that workers can chose to never report those tips as income, or not all of them, so no taxes. But if everybody went cashless by now, customers probably pay the restaurant, the restaurant pays the tips to the workers and all of that money is tracked and taxed. Is that correct?

anamexis 1y ago
Yes, that is correct.
milesskorpen 1y ago
yes
deleted 1y ago
[deleted]

alphazard 1y ago

It's fascinating to see the correlation in opinion between taxing tips and raising the minimum wage. If the prevailing sentiment was to make things easier for low income workers, I would expect people to want to not tax tips, and increase the minimum wage. And people who want less government interference, would want less tax, and lower minimum wage. Those are the two opinions I expected to see. But instead it seems like people want to tax tips, and increase the minimum wage, which is evidence of a kind of authoritarianism that I did not expect.

danudey 1y ago
Tips are still income. If we increase the minimum wage so that people can afford to live then I can't see any reason why we wouldn't tax tips also. If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. A better solution would be to prevent restaurants from paying their people poverty wages, and if servers aren't risking starvation and homelessness if they go without tips for a week then why would you not include their tips in their regular income? Raise the minimum wage, require servers to be paid minimum wage, and enforce a straightforward tax on people's income that doesn't distinguish wage from tips. Maybe also increase the 0% tax bracket to something more reasonable, like $20-40k, just to simplify things for people who are struggling to subsist while we're at it.
- 9rx 1y ago
  > require servers to be paid minimum wage There is no jurisdiction in the US that allows servers to be paid less than the standard minimum wage. Even where you find server minimum wages (your $2.50/hr example, although not all states allow this) the employer is required to top up to the standard minimum wage if tips don't cover the difference. Which makes this kind of silly, > If you're making $2.50/hr plus tips then I think you deserve a break and not taxing tips is a sensible break. If $2.50/hr + tips exceeds minimum wage, why do you need a special break? You're making more than other minimum wage workers. If $2.50/hr + tips does not add up to minimum wage, the employer has to get you to minimum wage, so you are making no less than someone else making minimum wage. If people with low income need a break, just give people with low income a break. How that low income is derived is irrelevant.

WaitWaitWha 1y ago

Just a historical note as a consolidated response to those who identify 'tipping' as an 16th through 20th century invention. This is incorrect as humans had 'tipping' all the way back to earliest recorded times. In the middle ages vails or informal rewards were given to well performing servants. In the Roman times corollarium (Lucilius, Seneca), a form of tipping was known. Cicero referred to tipping as stipen although some argue that is not above regular pay. There are some evidence that in the Han Dynasty, gifts were bestowed on well performing eunuchs, above their normal pay. Considering that in ancient times payments often were in non-monetary compensation, this could be considered a progenitor of tipping. Incas had similar systems of rewarding service with goods like cloth, though not exactly like modern tipping. Tipping, as we understand it today, likely did not exist in the same form in ancient civilizations, but there were practices where extra gifts or payments were given for exceptional service. > What has been will be again, what has been done will be done again; there is nothing new under the sun.