Corporate taxes don't factor in either because they are only on profit over and above all expenses. Increasing wages of an employee and shifting payment from tips to w2 income merely ensures the employee pays the taxes they should've be paying in the first place and will not increase corporate taxes.
If wait staff shifted to higher wages, the employer would increase prices and could note on the menu that tipping is not necessary, but appreciated. If that was the case, I would still tip, but only for above average service.
It constitutes a HUGE part of your take home pay for two reasons:
- If you are a waiter, tips will be multiples of your hourly pay.
- Tips will be under the table, saving you another ~25% easily.
So if you make a tipped hourly wage in Ohio:
- $4.15/hr * 7 hour shift (5pm open to 12pm close): 29.05
- Wait 6 tables, each with 3 seated parties, that tip you each $10: $60 * 3 = $120
Tips represent 4x of your salary. If your job gave you an untaxed 400% bonus at the end of every day, would you vote against it?
Shouldn't you compare to the minimum wage at least? Or you could compare to a standard wage similar to what would be paid in other countries.
Not in the state of Ohio, apparently. In many states, waitstaff can be paid below minimum wage, because tips!
I'd be rather more worried about getting caught by the Canada Customs and Revenue Agency.
If the IRS went on a crusade against underreported tips, there would be an absolute bloodbath in the poorer parts of this country, as tips easily represent more of their income than wages. Fortunately untaxed tips have dropped dramatically now that fewer and fewer people are using cash for transactions, so the IRS has had to take no such corrective actions.
My son was a waiter and did very well for himself while in school. Far better than working in my fast food restaurant when he was younger and I paid more than minimum wage.
Given the choice, I had several staff quit on me because they got a waitressing job and getting tips to make more money was the reason. I had several waitresses tell me that was the reason they would not work for me.
My son always tips 20% or more, no matter the service, because he was a waiter once. I tell him he's foolish as I tip 15% for good service and adjust up/down accordingly.
Wait staff love tips because it gets them paid significantly more than if they worked a retail job.
After visiting Europe, tips are necessary for good service. The rudeness and lack of service was culture shock.
All Europe was like this?
There is a stereotype that blacks are worse tippers than whites. As https://www.ebony.com/news-views/are-black-people-really-bad... comments, it might be because blacks have "Insufficient education about tipping", or "a loop of circular behavior where Blacks have been traditionally discriminated against, Blacks expect to be treated poorly and treat servers with disdain, servers treat Black patrons with less care because they “know” Blacks tip poorly, and Blacks continue to tip poorly because they continue to get substandard service." (there are a couple of other proposed reasons).
See for example http://www.tippingresearch.com/uploads/JFSBR_race_revision_a... which includes the quote “I will not take Black tables unless I have no other option; call me racist, but I also walk out with more money than the people who end up with them.”
Yes, if you are a black American, you might get rudeness and lack of service in service in your own country - because wait staff think you won't tip well.
Over here, more than a single interruption ("is everything OK?") is intrusive. Fake smiles and fake enthusiasm aren't desirable either.
In most of the EU you tip for good service. IE; only if your food came in a timely fashion, was not mis-prepared or incorrect and if the wait-staff are generally being polite, kind, courteous.
The idea is that you’re rewarding good service, not that your bound by social convention to give a percentage extra on top of what was agreed upon when you read the menu.
While we’re on the subject, the idea of excluding tax on good until you reach checkout is absolutely insane to me.
I was also a waiter in the restaurant. I hated the stress, but could find no jobs with comparable schedule flexibility/required qualifications that paid as well.