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Comment by chriscrisby

2 days ago

That’s a weird way to say a sizable majority of tipped workers do pay taxes and will benefit from this.

30 comments

chriscrisby

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aaplok  2 days ago

Beware the logical fallacy. "A implies B" does not mean that "not A implies not B".

Workers who earn too little to pay taxes (A) will not benefit from a tax cut (B).

But workers who earn enough (not A) may still not benefit (not B), for example because their employer indirectly pockets the difference. That is actually being argued in the article.

So this is indeed the appropriate way of formulating the statement: at least 40% of workers will demonstrably not benefit from this.

  • Izkata  1 day ago

    Pretty sure they are aware, they included the qualifier "a sizeable majority" instead of implying it applied to all.

  • wakawaka28  2 days ago

    I can't read this article because of the paywall. Are they saying that taxable tips are subject to payroll taxes (which employers pay out of pocket)? That would actually benefit both employers and employees in some sense.

    Some tipped workers, like bartenders, can make more in tips than a junior software engineer lol. Less taxes definitely helps their cause.

    If you are concerned with indirect effects, there's quite a few pros and cons that you could extrapolate from the no tax on tips policy. These arguments are far less compelling in general.

    • graton  2 days ago

      > I can't read this article because of the paywall

      I just turned on reader mode in Firefox and then refreshed the page and got the article. I'm surprised how often it works. It often doesn't but sometimes it does.

  • swagmoney1606  2 days ago

    But it would be true to say not B implies not A right? (contrapositive?)

    • delusional  2 days ago

      In that case B would be "is not taxed on the income" and A is "part of the 40%" making the statement not B implies no A: "If you are taxed on your tips that implies you are not part of the 40%".

      That seems correct. It's a pretty useless statement, but it is true.

lawlessone  2 days ago

it's indirect tax credits for businesses that don't want to pay workers.

  • reissbaker  2 days ago

    No, it isn't. It doesn't affect the wage they have to pay them. It just affects whether the employees need to pay taxes on tips.

    • croes  1 day ago

      It may not affect the wages they have to pay but may affect wages they pay if they pay above the minimum.

    • micromacrofoot  1 day ago

      it will absolutely affect the wage they are paid, it will be used as a constant excuse to not pay more than the legal minimum (2.13/hr as long as tips are greater than $7.25/hr)... probably used to justify additional tip stealing that happens pretty much everywhere, people will tip less because of it

      servers are treated like absolute garbage

      6 replies →

  • potato3732842  2 days ago

    There is no useful point to saying what you just said.

    You can make that argument about literally anything that reduces the tax burden on people who's primary income is useful income.

seanmcdirmid  9 hours ago

The tax system is graduated. If 40% don’t make enough to hit a band where income is taxed, then you can assume it’s a gentle ride from paying no taxes to not paying much taxes. And anyways, payroll taxes are by far the higher burden for service workers than income taxes.

FireBeyond  2 days ago

Well, to be fair, the IRS considers the average tip to be 8% for taxation purposes.

The whole "I get taxed whether you tip me or not", "I have to pay to serve you if you don't tip"? No, not so much. If you can show (there's even a hugely burdensome IRS form that might take as much as 3-4 minutes a month for cash tips) that you earned less than that 8% average, then that's what you get taxed. But most servers don't want to fill that form out, because they get ... rather more than that, and are being undertaxed already.

spondylosaurus  2 days ago

Sure, but TFA makes clear that any benefit to workers from tax-free tips is laughable compared to the numbers of times the restaurant lobby has fucked them over, by repeatedly killing attempts to keep wages low. It's not even throwing workers scraps, it's more like throwing them crumbs.