Kamala Harris Joins Trump in proposing no tax on tips. This is what I think will happen.
No Tax on Tips Fan Club Expands
At a rally in Las Vegas, Harris Calls for No Taxes on Tips, Borrowing a Trump Idea
“It is my promise to everyone here: When I am president, we will continue our fight for working families of America, including to raise the minimum wage and eliminate taxes on tips for service and hospitality workers,” Harris said. The idea could prove popular in the swing state of Nevada, which is populated by casino and other service-industry workers who rely on tips.
Trump in June at his own rally in Las Vegas floated a plan to eliminate taxes on tips, an idea he later said that he came up with after having a conversation with a waitress in Las Vegas. Trump narrowly lost Nevada in 2016 and 2020, and the state is competitive again this year, ranking as one of six tossup states in the presidential contest, according to the Cook Political Report, an independent elections arbiter. The state is also a Senate battleground. Sen. Jacky Rosen (D., Nev.) has already backed eliminating taxes on tips and is one of this year’s most embattled Democratic incumbents.
Trump accused Harris of copying his plan for political advantage. “This was a TRUMP idea—She has no ideas, she can only steal from me,” he wrote on Truth Social, his social-media platform. His campaign began testing out a new moniker, calling her “Copy Cat Kamala,” and complained that her stance contradicts a Biden administration proposal unveiled last year to establish a voluntary tip-reporting program.
There is likely to be a large debate in Washington in 2025 over the tax code, as big sections of the 2017 tax-cut law are scheduled to expire. The next president will have the opportunity to shape these changes during negotiations with Congress.
Bad Policy, Good Politics
Policies that favor one group over another are popular but unwise. Why should servers get tax breaks that no one else gets?
Most of this benefit will go to servers who are lucky enough to be working in an upscale restaurant or location.
How about treating everyone the same for a change? Of course, that would kill the mortgage interest deduction as well. Good luck to the politician who proposes that.
The tax code is a complicated mess because of vast amounts of “Me Too” vote buying BS.
Buying Votes
This will buy votes. It won’t matter one bit that Trump proposed it first.
Anyone for Trump specifically because Trump proposed it, now has a choice.
I foresee a debate one-liner, where Harris responds “It’s the only good Idea you ever had, so naturally I embraced it.
Where this ide goes depends on who wins and whether one party wins the trifecta.
What Will Happen?
- Republican Trifecta: No tax on Tips
- Democrat Trifecta: No tax on tips
- Republican White House But No Trifecta: Democrats won’t support the idea
- Democrat White House But No Trifecta: Republicans won’t support the idea
Trump Fires Arrows Missing the Target Badly
Meanwhile, while Democrats have rallied around Kamala Harris, Trump is still fighting the 2020 election.
In a feud the party thought was long over Trump is throwing bombs at popular Republicans like Georgia Governor Brian Kemp instead of focusing on the economy.
For discussion, please see Trump Fires Arrows Missing the Target Badly, Will a Recession Save Him?
I support lower/no taxes, period. If they lowered taxes on everyone but me I would support it.
No tax on tips: Why politicians love it, and economists don’t
By Luke Garrett NPR4 min
August 12, 2024
Vice President Harris and former President Donald Trump don’t agree on much — especially when it comes to economic policy. But they both want to get rid of taxes on tips.
…
http://npr.org/2024/08/11/nx-s1-5071144/no-tax-on-tips-campaigns-trump-harris
The underground cash economy is strong everywhere. This is why measuring economic activity is such a farce.
I thought taxes were to discourage a behavior? At least back in the rational days…
So tax the hell out of those who receive money because they have money and gambled to their advantage, and reduce the taxes on those who actually work?
Encourage payroll labor by dropping their taxes to zero (to some level) with their labor and jack the rates for those who earn based off of speculative investments and non-labor income?
I know, it’s a hard crowd here, but the principle isn’t wrong. Hard work should be encouraged, not spinning the “investment” wheel because the tax code encourages it.
“I thought taxes were to discourage a behavior?”
You were dead wrong. Taxes; at least any potentially legitimate ones; exists to pay for government services. All of which ultimately boil down to protecting people and their property. The former which; as long as “all men are equal”, net out to zero.
Leaving the latter: Property protection. Not just real property but; conceptually at least; all property. And since that’s the service rendered; the only economically efficient way to fund rendering it; is to charge for exactly that protection. Not “income”, which no legitimate government has any business erecting a STASI apparatus targeted with snooping into. Nor, ditto, “sales.”
But instead, just property: If you want government to protect yours, you have to: A) Let them know it’s yours. Thus eliminating all tax possible fraud; along with any supposed “need” for spying and ratting out people. All at the very affordable, efficient, cost of zero. And B) Pay for it, since property protection is not free. Someone has to pay for it. And unless one is truly, monumentally retarded, it is plainly self evident that noone other than the one receiving the service, has any such duty to pay.
Again: Not just real property. But also “shares”,patents etc.: Anything monopolistic government protects, in order for that protection service to be more efficiently rendered, than if people instead had to do it themselves: Holing up behind sandbags with a rifle.
And also: Not just physical protection as in a security guards and cops: But ALL of courts, registers/databases of who owns what, ownership transfer processes, military etc., all exists ultimately to protect property. Directly. Indirectly, so do roads and other infrastructure. And even possibly costs for things like welfare, to the extent they prevent recipients from getting desperate enough to revolt and burn everything down since they have nothing left to lose anyway.
It all boils down to that: Property protection. On the theory that this is one fundamentally “special” service that, unlike any other, is more efficiently rendered by a monopoly than by disjoint individuals with guns having to do it themselves.
How about I pay my employees 8 bucks and hour.. then make up the difference with tips…
I see that in Panama City Beach like with barbecue restaurants.
A friend worked various roles from front counter and cashier and in the back with cooking at a barbecue joint.
He was told he will be paid a “guaranteed $15 an hour” and the barbecue restaurant kept the tips.
He’s working now in a similar role at an informal (non-fast food) restaurant (order food at front counter, and get it served to you at a table) that pays him $12 an hour, and yet he’s averaging $7 an hour in tips year round.
It is only going to apply to the special employee category of “and eliminate taxes on tips for service and hospitality workers”.
and then get the Federal Fica Tip Credit, which goes to the employer…………Done all the time
Most companies already do that for donor-class employees: Some nominal salary; and the rest via share buybacks.
Talking with a Waitress as in woman voter who is working not for the fun of it but because Bills need to be paid. Probably delaying having a family or enlarging an existing one. Paying Taxes on all earnings as per Uncle Biden vs. getting a look the other way from Uncle Trump when providing top service in order to get a nice tip.
Seems a message to voters who hear about all the DC deficit spending and support for Ukraine’s civil service workers but no relief back in the USA.
So who actually lives in the real world Trump or Harris a working woman voter might be asking ?
Guess it is all not going to be about abortion for Woman.
Trump seems like he’s intentionally trying to throw the election. I think we need to start figuring out how to pay down the massive national debt instead of more tax cuts. Another big boost to the economy would be trying to deal with our 1920’s oligarchy levels of income disparity and getting more money into the hands of the poor and middle class without an inflationary pulse. The millennials have been hammered with the GFC and the pandemic and are mostly broke.
Pay down the national debt!!! ROTFLOL… impossible… the discretionary portion (defense, all federal pay, all federal departments, IRS, Secret Service, department of everything, FBI, etc) of the federal budget could be reduced to zero and we would still have to borrow money to cover mandatory spending (SS, Medicare, medicaid, etc.)
You’re talking at least a 2 trillion reduction in federal spending… can you say or spell bankruptcy…
How about scrapping any government expenditure on healthcare? Have a free market, competitive hospitals, enforce laws against collusion and price fixing, ability to buy medicines from any country etc and healthcare declines from 20% of GDP to under 4% such that the vast majority of people could pay for their own medical bills and those unfortunates at the dregs of society would be relying on charitable hospitals once again.
Also encourage self responsibility, why should responsible people pay for lard arsed idiots eating processed high carb diets. You want to weigh 400lbs then pay for your own insulin and mobility aids.
“Pay down the national debt!!! ROTFLOL… impossible…”
No it’s not. It’s debt denominated in Monopoly Dollars, Just print up enough to pay it all down and then some. Exactly a fraction of a millisecond prior to going back to instead using real, $20/oz, non-counterfeit dollars in the US.
We’ve got such real dollars in Ft.Knox. And, just in case anyone gets too agitated and self righteous…: We’ve also got 10k nuclear warheads.. So: We’ll be alright.
Besides: Anyone dumb and/or scummy enough to buy bonds knowingly backed by nothing existing; but who instead cynically speculated that said bonds would be used to build up a terror state, who would then force Americans who never had any say in the matter to work their rears off, only to have their earnings stolen to pay off the cynical scumbags’ “bonds”; deserves to lose everything they own and then some. After all: They committed the single greatest crime which can be committed: Facilitating the growth of illegitimate government. Unless that is seen to have rather severe consequences; we could well run the risk of more people doing so as well. Which is something that would be truly tragic.
How do you dump cash into the hands of people without driving inflation even higher?
The problem we now have is that we have burned up most of the cheap energy (and used most of the cheap resources)…. what remains is generally expensive…
So throwing money at this will only result in a greater demand on resources that are severely depleted… causing more inflation.
It’s a supply and demand thingy…. and supply costs are increasing
How about cutting taxes AND slashing expenditure? A much smaller government will mean the national debt can be paid off and a smaller government means less inflation and ideally a gentle deflation.
Gentle deflation makes speculation on stocks and real estate a losing proposition and at the same time reduce interest rates. Good for home buyers, good for those doing productive investments and bad for speculators.
As for taxes on tips that is another of those silly American things. Most countries don’t have taxes on tips or gifts.
What a fake bimbo. Stealing Trump’s ideals.
Next from Kamala:
Build the wall and deport all Mexican-Americans!
Unless your car is rolling around on square wheels: Look in the mirror: You stole the wheel from that stone-age guy. For your sake, I hope you have ambulancechaserology insurance; in order for Idioterica’s new upper class of illiterate ambulance chasers, to have properly deep pockets to rob on account of your theft!
Kammy had to drop a package and so they broke into a nail salon …
Who is Kammy?
Seems only fair. hedge funds get tax breaks, corporations get tax breaks, why not other sectors of the working populace?
Why are these low-wage people considered so special? Here in CA, they legislated a special minimum wage ($20/hr) ONLY for fast food workers. And a special $25/hr minimum for anyone who works in a healthcare setting, even janitors.
Why are healthcare workers more special than fast food workers? Why are any workers more special than anyone else? Doesn’t anyone remember Animal House?
Why hasn’t someone who isn’t a fast food worker filed a class action lawsuit challenging their special class treatment?
I think you meant Animal Farm. I do remember Animal House, though. “Do you mind if we dance wif yo dates?”
Dammit! You are correct! And I also remember Animal House.
I keep hearing about “no taxes”. There are Social Security taxes, Medicare taxes, Workers Comp. taxes, Unemployment Insurance taxes and don’t forget State income taxes. This idea doesn’t seem unfair to me becaues, if I think I am unfarely being left out of this new benefit, I just have to tip 2%.
The best thing would be to stop the whole tipping nonsense in US restaurants. They don’t do in Europe, and the service in restaurants is usually much better than in the US (not to speak of the food).
This is freaking STOOPID!
Tips are income and they should be taxed the same as other income.
Otherwise, why are people making tips ‘more equal” than those who get paid salary (another form of income). Sheese.
You will see this Trump-led bipartisan nonsense pass, and then your dentist wants to be tipped for his dental cleaning services. And the dentist is right!
It’s not about what’s fair. Clearly they should be taxed the same.
Rather it’s more about how it’s basically impossible to enforce since tips can easily be undeclared income and there is no way the government can track it all down.
The underground economy runs constantly. I pay cash for lots of services (my lawn guy, various minor electrical/plumbing/AC work etc). Absolutely none of that gets declared. It’s no different than tips.
BS. It’s easy to track money. Eliminate cash completely and make all transactions electronic.
What are people refusing to participate going to do, trade gold dust? Let them barter. Most people won’t bother.
This is what an AI Overlord would do. No back and fro whining. It would just say, “This starts in 60 days. Now shut up”.
So according to you the Government is now entitled to monitor a persons spending.
That is an open invitation to Tyranny.
If Harris who you will be voting for gets her way they will “Guide” a persons spending into the “Proper” avenues.
This is the thinking that Will start a Civil War between the States as Free people Will not accept this situation.
The restaurant industry is moving rapidly to 100 percent cashless transactions. This is the reason why the promise of tax-free tips is such a potent vote buyer in the US. It’s just another form of legalized corruption.
You can always tip in cash. I often pay by card and leave the tip in cash.
Not if cash doesn’t exist any longer!
I don’t know about you but there is definitely a difference in Waitress facial expression when I leave a Cash tip on the Table vs. the tables who put it on their card.
Still says on the greenbacks good for all debts public and private.
So who am I to change that motto!
Heaven forbid I be the one who makes it a harder Life for a pleasant young Gal just doing her job.
If you could outlaw cash, people will just cash app / zelle / venmo to someone else.
So what if the government sees it. Try and prove what it was for. An IRS agent probably makes on the order of 200/hr (when you factor in heath benefits/401k and so on). If it takes them 1 hr to investigate a 100 payment I make to my lawn guy then it’s a net loss 180 dollars (based on the guy not declaring the 100 at 20% tax rate). The government still wouldn’t bother.
Waitresses and waiters work hard during the weekend in busy restaurants. They might share tips with the kitchen staff, but under a federal law they cannot share tips with the boss. Bartenders/ waitresses, with good relationship with the boss, get the best shift.
Serving 30/40 customers/nite in several tables billing $40/each, including drinks :
35 customers x $40 x 0.18 tips = $250 plus min wage. With a crew of several waitresses and good kitchen staff vol is in the millions. Covid killed the competition, yet vol is slowing.
Brian Moneyham, “Face the Nation” : Consumer spending is rising, but at a lower pace, depleting their saving accounts. No recession.
How does it work at strip clubs these days – Venmo?
Strippers are independent contractors. They typically pay a fee to work in the club and then recover that via cash made from customers. Thus they aren’t sharing with anyone in the club.
Strippers prefer cash but most these days carry those portable credit card devices that attach to their phone so they can run your card on the spot. I suppose one could cash app them too.
Then creative employers will pay employees the minimum wage, but different amounts of “tips” every year to make up the difference. Everyone but the government wins.
I think it is perfectly reasonably to apply tips generally. School teachers, for example should get a minimal base salary, say $30K, with parents paying tips (to insure proper schooling)
YES! That is what I want to do.
Is there a MIsh tip jar for your valuable service?
It’s been a while, but the last time I looked, the Internal Revenue Code(aka Title 26, US Code) stated something like :
“Gross income is all income from all sources that isn’t specifically tax-exempt under the Internal Revenue Code.” I assume it would mean Congress would need to pass an amendment to the code.
If passed, and applied to ‘services,’ the family practitioner could charge $x per visit plus a 25% tip.
The thing that’s shocking is that this is a Trump policy issue in the first place. He was a waste of space in his first term and I excused it to the Dems’ investigation-hooey. There were signs, pre-Vance, that we might get a somewhat radical, America-first platform. Instead, we’ve got incoherence with a side dish of god-bothering. If the left weren’t so scary, I would stay home.
…but the left are scary, united in their evil destruction of all things good in America. They must be stopped.
Mish, it make not be fair but from a tax code point of view it makes sense because it legalizes what it already happening anyway.
People who make tips mostly don’t declare them now. So the IRS can either audit them (costing a lot of money, maybe more than they can get in the audit in which case that’s a double loss for taxpayers) or just ignore their cheating entirely which is the same thing as legalizing the money from tips as being non-taxable.
Until there is a cashless society, tips (esp cash ones) will always be undeclared so might as well win a few votes in legalizing it.
On the other hand it’s clear Harris and her campaign has ZERO ideas of her own. She is going to run on ‘I’ll do whatever Trump does but under a Democrat banner’.
So, now we legalize tax cheating? A better idea might be to disallow tips as deductions on business expenses.
A rule you can’t enforce (ie forcing tips to be declared as income to be taxed or attempting to chase down people who aren’t declaring tips) is basically useless.
It’s akin to jaywalking. Technically it’s against the law and you can get a fine but in practice you can jaywalk in front of virtually any cop and they will ignore you unless you do something really stupid (like get hit/almost get hit or cause an accident/almost cause an accident).
Don’t get me started on the subject of tips.
Bad policy ? It’s a GOOD policy. There are multiple things that favour one group over another group and you are worrying about these “peanuts” ?
There is a much better way to do this. Abolish tipping all together and increase the wages of the workers.
How would you ban tipping? Tipping has only become more pervasive since Covid. Low wage businesses like tipping because tips are not directly shown in the price of goods and services.
You don’t have to ban it. A venue could have a sign at the entrance and at the top of each menu that it is a non tipping venue. So the staff would be paid a full and decent wage and the customers would know that the higher price on the menu is the total they would pay.
Staff would not be allowed to ask for tips but if a customer still wants to tip then they are free to do so.
Let’s face it. The current tax code is ridiculous. I have a degree from a top notch university in accounting. I thought the tax code was the most incomprehensible text ever written. It’s like a house designed by a bad architect and has had bizarre additions added throughout the years.
It’s not a good system if I can bring my tax receipts & documents to half a dozen tax-preparers and get back 6 different answers. i believe the tax code was written to exploit loopholes.
It’s designed to make partners in accounting firms million+ take home pay.
A lot of it is intentional. If it were easy to file or free to file then there would be a lot less cream for a couple companies to syphon off. If the code was less convoluted then most would simply file their own.
https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free
If you want a tax system that’s less complicated then this is one good small step. If both Harris and Trump proposes this then what are we waiting for.
Who knew that Trump’s stupidity is infectious. At the same time, it’s possible that Trump mixed up TIPS and tips.
I make $80K a year as an electrician… Some restaurant guy makes/earns $50K plus another $30K in tips for a total of $80K…. need I say more .. A truly unfair idea… BTW… I always tip in cash… I’m Sure those folk are declaring that income… !!!! LOL..
The IRS imputes tips for many businesses. Some tipped income evades taxation, but not much. Paying in cash for goods/services is a different matter. Lots of cash-based businesses evading taxation.
Yes and all those people not reporting cash income pay the price when it comes time to collect SS.
If they invest what they have saved they won’t need SS
People living on cash and unable to pay taxes don’t seem like the kind that “invest” in anything. They are hand to mouth bottom feeders who don’t expect to live long enough to collect SS.
We NEVER tip in cash so the income will be reported to the business and will be taxed.
A question for you?
Are you telling me you have NEVER EVER done a job for cash? Not for a friend or family member? If you haven’t you are clearly missing out big time. Every trades person I know will happily come over and do a job for cash which we both know isn’t being declared.
We can treat everyone the same by having a flat tax/ NO deductions. The more you make the more you pay.
You still have the problem of undeclared income. Cheats will continue to cheat.
The most fair system is a poll tax. Everybody pays the same tax on the principle of one man, one vote, one tax.
Those who don’t pay the tax don’t get to vote.
Earned income is earned income.
Brian Kemp is an enemy of the people. Brian Kemp and other establishment Republicans helped install Biden to the White House.
Elections have consequences. Stolen elections have catastrophic consequences.
There is no evidence of a stolen election. Trump would have won had he stuck to issues and not childish tantrums and name calling..
Correct – There is no evidence of vote fraud that would change any state, let alone enough to change the election.
Trumpian arrogance, name calling, etc., cost him the election and Republicans the Senate as well.
Trump values loyalty more than winning. Reigniting feud with Kemp proves it.
“let alone enough to change the election.”
https://www.washingtonpost.com/opinions/2020/11/18/how-2020-election-was-closer-than-2016/
The arrogance and stupidity was a shotgun approach to vote fraud. TrueTheVote has a detailed approach that has uncovered lots of suspicious activity. TrueTheVote and some similar efforts cannot produce actual vote fraud because the voting system is not subject to audits to uncover vote fraud except in some specific cases.
Democrats loosened election rules in many states in 2020 with the help of Mark Zuckerberg and probably others. With deliberate failure to clean voter rules, ballot harvesting, motor voter, lots of motivation to cheat, and little to no efforts to stop cheating, voter fraud had huge potential to change election results in some states. Millions of ballots could have been voted illegally. No one knows the extent of voter fraud in 2020 because Democrats stop efforts for detailed auditing and controls. The potential for widespread fraud in the 2020 election is a valid assertion.
Our elections have been manipulated such that they can no longer be reliably audited. Many people have no confidence in our elections. A recent national poll shows that 2/3 of Republicans believe that there was significant fraud in 2020. F evidence, even though there was plenty, the burden should be on the government and those who run the elections to restore confidence.
There was never any investigation into voter fraud – anywhere. Georgia did a cursory and meaningless recount.
It took 4 years to charge a single woman with stuffing a ballot box in Arizona, and they DROPPED the serious charges of forgery and conspiracy. There were numerous videos of this activity all over the country and nothing came of it. https://www.cbsnews.com/news/arizona-woman-admits-guilt-in-ballot-collection-scheme/
That doesn’t begin to address the vans loaded with ballots showing up after midnight to be counted, fake water pipe breaks, suitcases of ballots pulled from under the tables, and cardboard boxes plastered on the windows to hide the ballot counting. None of it was investigated, just chalked up to conspiracy theorists, case closed.
60-70 separate cases to challenge this crap, with NOTHING to show, even from Trump-appointed judges.
For crying out loud, stop this juvenile crap. No different than if the Cleveland Browns wanted to sue to stop their losses rather than just winning.
‘No standing’ determination by judges ensured no blackmail against them.
That’s very naive
What do you call it when the mass media uses the fallacy of repetition to load the deck? It is worse when what is repeated are outright lies. RussiaGate, for example was nothing but lies.
If 51 intelligence officials had not interfered in the election along with media that suppressed the Hunter laptop story, Trump could have won the election. Google said they were not going to allow 2016 again. Election interference. Fraudulent 2020 impeachment, election interference. Not a free and fair election.
You have to laugh to keep from crying.