Because income is taxed. We have a progressive tax system, so the first small amount is untaxed, the next is taxed at a low rate, the next is taxed at a slightly higher rate, and so on through the tax brackets.
You’re now saying that salary and hourly employees wages should be taxed, but not tipped income. So my question remains, why shouldn’t it be taxed? Why create an inequity between different sources of income.
Imo, income tax should only affect the rich, and they aren’t working tipped jobs.
Not taxing tipped income doesn’t achieve your stated goal. The majority of low and middle income wage earners are still taxed. Altering the tax brackets would be more fair, and come closer to achieving your stated goal. Exempting tips remains a terrible idea.
Why should it be taxed? Not “Why it shouldn’t”.
Imo, income tax should only affect the rich, and they aren’t working tipped jobs.
Because income is taxed. We have a progressive tax system, so the first small amount is untaxed, the next is taxed at a low rate, the next is taxed at a slightly higher rate, and so on through the tax brackets.
You’re now saying that salary and hourly employees wages should be taxed, but not tipped income. So my question remains, why shouldn’t it be taxed? Why create an inequity between different sources of income.
Not taxing tipped income doesn’t achieve your stated goal. The majority of low and middle income wage earners are still taxed. Altering the tax brackets would be more fair, and come closer to achieving your stated goal. Exempting tips remains a terrible idea.