Tax Tips

 

No, I am not disagreeing with Trump. And no, this is not a post on how to increase your refund. Or on how to make out like Timothy Geithner a bandit with TurboTax.  It’s a little more general.

First, I am all for Trump’s suggestion to not tax tips. That should garner him some votes in Las Vegas. I grew up outside of Las Vegas during the Rat Pack days and begrudge no one untaxed income: taxi drivers, concierges, waiters and waitresses, shoe shine kids, blackjack dealers, doormen, room service personnel, rest room attendants, bartenders, ushers, coatroom attendants, security guards, desk clerks, masseuses, escorts. Whatever. (All write-offs for business expenses, of course).  Especially in Vegas where a lot of money gets thrown around.

The one thing that really stays in Vegas is the money. Great.

That paid for excellent school facilities when I was in public school in Clark County. No state income tax. Low property taxes. A state run on gambling revenues and tourist dollars.  Welcome to Las Vegas, the iconic sign says. Welcome, indeed. In those rat pack days, Las Vegas was the safest city in the country — unless you crossed the mob.  You could walk the (air-conditioned, like Fremont Street) sidewalks 24 hours a day in perfect safety. The mob didn’t want criminals interfering with their casino revenues. Oceans Eleven was pure fantasy. Even the Kefauver hearings didn’t slow down the mob. And, after those hearings in 1952, when the eastern bankers wouldn’t lend the mob money to build their casinos, into the breach, rushing down from Salt Lake City in 1954 in the wake of the Kefauver hearings, leaped E. Parry Thomas, a banker, who got rich by providing the needed funds. So rich he donated the Thomas and Mack (Mack was his partner) events center to UNLV. Thomas claimed the mobsters of Las Vegas left their evil ways behind in New York and were model citizens, legitimized by Nevada’s legalized gambling. Their word was as good as, maybe better than, gold. So Thomas averred.

And those mob bosses for sure skimmed plenty off their gambling revenues, which allowed them to evade a lot of taxes. If the mobsters can do it, why not the employees? Skim, baby, skim. Roll those die. Snake eyes for the government!

And I don’t care how unfair that is to those of us who have earned income that is taxed. For me, anyone who can avoid taxes is a credit to the country, a true American patriot. The money is more productive in almost anyone’s hands than in the hands of the federal government. I am a Wesley Snipes wannabe. But I don’t have the guts to put my money where my mouth is, as the saying goes, like he did. I have a deathly fear of federal penitentiaries. And undying admiration for Wesley Snipes’ stand on principle. And that fear of government?  Therein is the problem. 

If you fear your government, you are not living in a free country.

My father had a heart attack at age 62 during his first and only IRS audit. He passed the audit with no penalties or charges, but it almost killed him. It disabled him sufficiently that he had to retire after the audit.  What didn’t kill him certainly didn’t make him any stronger. And his fear of the IRS certainly impacted my young mind.

And then we have twits like Obama, who proclaims “YOU DIDN’T BUILD THAT.”  As if the government owns you, which, in his mind, it does. The government that took your money away from you in taxes to pay for the roads and infrastructure that you use and on which your business relies — at least when they are not so full of potholes as to be impassable.

The retort to Obama should be:  You didn’t create that wealth!

The government generates no wealth. It only confiscates it from citizens. Generally, it impedes wealth development, particularly with its tax policies. Only when government protects property rights does it contribute to wealth development. But now the US government is mostly in the business of sabotaging property rights. Obama added insult to injury by demeaning the wealth producers of our society–all of them! A pox on him.

My wife is from Brazil. Her father was in the Brazilian military police all of his working life. Except for the time he was on the wrong side of an attempted revolution and spent time in jail being tortured. She never ceases to be amazed at the disdain her father had for America, where the most violent of criminals could not be put away on criminal charges, but only on tax charges (he was more or less a contemporary of Al Capone). Violating tax law in America was more serious than murder and racketeering in his view. And he was pretty much correct. Fear and intimidation imposed by the federal government via a federal income tax, under which America has suffered for 110 years. Time for change. If you have any change left.

Remember, there is now no limit on what Congress can call a tax. Doing nothing (Roberts tax/penalty duality decision) can be taxed. The Supreme Court declines to ban a wealth tax, and the Democrats are salivating at that wealth-destroying, economy-destroying tax, on top of the individual income tax and all the imposed State taxes. It’s almost as if they wanted a socialist state with the government controlling the means of production and the wealth generated by production. Or is that Fascist? Or Communist? Hard to distinguish. (Remember, England for much of the 20th Century was a Fabian Socialist State. Until Margaret Thatcher.) But, just as America has backslid from Reagan, Britain has backslid from Thatcher.

Anything that allows the government to take money from citizens, that Congress can get passed and signed into law, is now legit. And it really doesn’t matter anymore, inasmuch as revenue is confiscated by the federal government, because the government will always spend more than its income anyway.

Unless, of course, Americans do something about it. But I’m not optimistic. The entire federal government is now up to little more than kabuki theater:

The border is secure. No.

We are supporting Israel against Hamas. No.

The economy is in great shape. No.

Trump is a felon. No.

Biden is not cognitively impaired.

No. Iran is harmless. No.

Etc., etc., etc.

Realizing that my suggestions will fall on deaf ears, or hostile ears, or be misunderstood, I will hazard a suggestion.

Donald Trump is floating around the idea of financing the federal government via tariffs only. By that, I take it that he is toying with the idea of eliminating the individual income tax. Running the federal government on tariff revenues would of course prove disastrous — we are no longer in the early 19th Century.

So that idea is a nonstarter.

There is, however, another approach included within the original Constitution Article 1 Section 9 (which originally banned direct, ie, individual income, taxes, which was mooted by the 16th Amendment ratified in 1913).  A federal income tax was passed in 1861 during the Civil War and expanded in 1862 and 1864, but those taxes lapsed during Reconstruction. A national individual income tax was barred by the Supreme Court in 1894. So the Progressives (and in America at the time, there were only Progressives of one degree or another) went to work plotting a constitutional amendment to permit a federal income tax. A steeply progressive income tax is a major plank of the Communist Manifesto, so it must be good. Of course, that amendment was greenlit (as America was gaslighted) by none other than that prodigious (35o lbs) Progressive, William Howard Taft. (No Taft was not a conservative, regardless of what you have been told. He was arguably a little less progressive than Roosevelt, both Teddy and Franklin, Wilson, etc. etc.) Which after 110 years has given us Leviathan, with no end in sight — until what can’t continue, doesn’t.

So, what did the Constitution (the original one, that is no longer in effect) allow?  It allowed an indirect tax, applied to the states, based on population. That approach has never been tried. Now the federal government extracts revenue from individuals and doles it out to the states depending on the relative power of each particular state’s representatives and senators. The reverse should be true. The federal government should have to go to the states to get its revenues. This is supposed to be, after all, a federalist system.

So how do you do that?  You take the federal budget and divide it by the total population. That gives you a per capita amount spent by the federal government. You then go to each state, and multiply that per capita amount by its population, giving you that state’s contribution to the federal fisc. The state would then be responsible for raising the revenue from its citizens to pay that bill. Simple.

Of course, states could indulge in all kinds of skullduggery in their tax schemes, but at least citizens could vote with their feet, as many are doing now, and flee the places with the most onerous tax systems. Further, the idea of increasing a state’s share of federal liabilities for welfare and social programs by allowing illegal immigration would be instantly disincentivized (although allowing illegal immigration to a state to try and boost its number of Congressional seats, and thus political power, would not be disincentivized). But the impact on social programs in such a state would potentially create turmoil, and motivate productive citizens to flee, potentially leaving such states (California) populated mostly by illegal immigrants.

In such an approach, the federal government (although perhaps not the state governments ) could not terrorize individual citizens, and tax endlessly.  Yes, a repeal of the 16th Amendment would be necessary. And it would have to be blazingly clear in the repealing amendment that the US federal government cannot directly tax citizens in any way, shape, or form. And that the Federal government can ONLY get its revenues from the States comprising the Union (would some States secede?). Another thing that would be incentivized would be for states to promote their own economic growth to more easily meet the burden of their allotted amount paid to the federal government.

The IRS could be abolished. A Department of Tax Relations could be created to manage the taxes with the states. The power of the federal government would decline. The power of the states would rise. The use of taxes as social policy by the federal government would end. The tail (the federal government) would no longer wag the dog (the union of states in a federalist system). Freedom would expand. The repealing amendment could include an article requiring that the federal budget be paid in entirely every 2-year election cycle. That would eliminate federal deficits, and the debt could be paid down over time by assessments on the states. Blowout federal spending would hit a wall of reality as the federal government had to negotiate expenditures with the states. The dynamics of fiscal policy would change almost entirely for the better.

But who in America gives a rodent’s patoutie? No one that I know. Americans are supine, oblivious, perhaps hopeless, as decade after decade we grow closer to the Weimar State. Or Venezuela. As public debt exceeds GDP with no end in sight. And there is obviously no political will to fix our fiscal problems. Even Donald Trump pays no attention.

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  1. kedavis Coolidge
    kedavis
    @kedavis

    Nanocelt TheContrarian: Violating tax law in America was more serious than murder and racketeering in his view.

    And 20 minutes into the future…

    • #1
  2. Nohaaj Coolidge
    Nohaaj
    @Nohaaj

    I am a glass of red wine, and two screwdrivers into the evening.  Your post makes perfect sense. But, has less than zero chance of ever becoming reality.

     

    There is too much graft built into the system to ever see the light of day, much less be seriously voted on. 

     

    I wish we could prove otherwise. 

    • #2
  3. The Reticulator Member
    The Reticulator
    @TheReticulator

    Nanocelt TheContrarian: anyone who can avoid taxes is a credit to the country, a true American patriot. The money is more productive in almost anyone’s hands than in the hands of the Federal government.

    So if you take this approach, what happens to the national campaign to remove the tax-favored treatment of municipal bonds, which is a tax avoidance mechanism that enables those who are well off to favor more steeply progressive income taxes while protecting their own income from taxes, and which builds up the alliance of local, state, and federal government in a united front against the American people?  

    • #3
  4. Nanocelt TheContrarian Member
    Nanocelt TheContrarian
    @NanoceltTheContrarian

    The Reticulator (View Comment):

    Nanocelt TheContrarian: anyone who can avoid taxes is a credit to the country, a true American patriot. The money is more productive in almost anyone’s hands than in the hands of the Federal government.

    So if you take this approach, what happens to the national campaign to remove the tax-favored treatment of municipal bonds, which is a tax avoidance mechanism that enables those who are well off to favor more steeply progressive income taxes while protecting their own income from taxes, and which builds up the alliance of local, state, and federal government in a united front against the American people?

    The need for tax exempt bonds would disappear at a Federal level. The distortions of credit misapplication and the economic harm therefrom would also disappear. And the economy would be better off, and everyone would be better off. And the municipalities would have to justify their bond issues on something other than tax advantage, like the support of the community with a higher expected benefit to the municipal investment.  States would likely continue to provide tax exemptions as they would be taxing citizens to pay their federal tax allotment, but they, and the municipalities, would be much closer to the citizens that they have to answer to in elections. In my view, corruption would decrease as would economic vetting and improved investments.  Plus the competition between States would tend to blunt the States gaming the system, like imposing high tax rates then giving tax exemptions for municipal bonds. Citizens could relocate or buy the bonds to avoid the high taxes. The wealthy purchasing the bonds would have to live in the State to get the benefit, or do business in the State to get the benefit, and be subject to the high tax jurisdiction of the State. And would have to live with the consequences of their investment. I am not claiming the system would be fair. Just more fair, reasonable, and less economy distorting than our current federal tax system, which is more convoluted than the Gordion knot. And yes, it would take an Al.exander to slice through that monstrous tax code, which no on can unravel piecemeal. But this would be an initial sword strike on that Gordon knot of federal taxes.

    Let the States and the Federal government fight over the federal tax bill. It might teach the federal government a little humility in dealing with its citizens.

    And to put a cherry on top of the sundae, the 17th Amendment should be repealed and States would have control of their Senators again, rather than the political parties as is the case now. Then there could be a battle royal between the States and the Federal government regarding federal spending and taxes. Leviathan might actually shrink, and the dogs of taxes and spending be leashed.

    And if you really want to fantasize:  Eliminate the Federal Reserve. The Treasury department can take over the Feds necessary functions. Per Dr. George Selgin’s suggestions, you could provide adequate increases to the money supply with a formulaic approach, and let the economy suffer its own ups and downs without the Fed intervening and making matters worse, as they have repeatedly, since the 1920s onward, as the politicians have continued their blowout spending, making the Fed’s job well night impossible.

    I know. One giant fantasy. Nowhere near reality.  But can I dream?

    • #4
  5. Nanocelt TheContrarian Member
    Nanocelt TheContrarian
    @NanoceltTheContrarian

    Nohaaj (View Comment):

    I am a glass of red wine, and two screwdrivers into the evening. Your post makes perfect sense. But, has less than zero chance of ever becoming reality.

     

    There is too much graft built into the system to ever see the light of day, much less be seriously voted on.

     

    I wish we could prove otherwise.

    Have a couple of more screwdrivers and we will eliminate the EPA, the Department of Education, the Department of the Interior, etc. etc.

    • #5
  6. Bob Thompson Member
    Bob Thompson
    @BobThompson

    This is how any federal revenue issues should have been resolved from the beginning. The current system enables unlimited taxing and spending and the Federal Reserve Bank, created the same year as the 16th Amendment, is the implementing mechanism. That was a silent revolution.

    • #6
  7. cdor Member
    cdor
    @cdor

    I have wondered since I was a much younger man, why, in a free country, the money needed to run and protect that country was collected by the entity furthest from the people of that country. Why are we not paying our taxes entirely to the counties in which we live? Then the counties would send a portion to the State which, in turn, would send a portion to the Feds. In that way, the folks taking the citizen’s taxes are the ones closest and most answerable to that citizen. The Federal government would be held totally accountable to the people paying for its services. You know, as long as we are dreaming…….

    • #7
  8. OldPhil Coolidge
    OldPhil
    @OldPhil

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    • #8
  9. Bob Thompson Member
    Bob Thompson
    @BobThompson

    OldPhil (View Comment):
    He’s trying to bribe a specific category to get votes.

    That’s true, but the nature of the specifics used for the bribe are very different. 

    • #9
  10. Nanocelt TheContrarian Member
    Nanocelt TheContrarian
    @NanoceltTheContrarian

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    The difference is that all of the taxpayers are being shafted to assist those liable for college loan repayments to skirt the law. That is money that is unfairly confiscated from the many who receive no benefit. Biden is allowing the few to illegally avoid their obligations already incurred, for no other reason than to vote for Biden. Trump on the other hand is providing an opportunity to the few, but only on the basis of their own work and service. And he is incentivizing them to provide better service to their customers and removing the governments take from the extra benefit the worker receives subject to the judgment of the customer for the additional effort of the worker. Greater service, greater reward, without the government vitiating the worker’s incentive. All the difference in the world. While society might be slightly disadvantaged by slightly less government money (which would mostly be wasted) still, in my view, the benefit to society far exceeds the cost. In the case of Biden’s action the reverse is true.

    • #10
  11. Chuck Coolidge
    Chuck
    @Chuckles

    Who gets to define “tip”?

    • #11
  12. cdor Member
    cdor
    @cdor

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those  loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    • #12
  13. OldPhil Coolidge
    OldPhil
    @OldPhil

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    • #13
  14. Bob Thompson Member
    Bob Thompson
    @BobThompson

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    Putting Vegas players into the equation is likely very effective for dissemination to interested parties.

    • #14
  15. cdor Member
    cdor
    @cdor

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    I’m sure that you realize there are a lot of people that earn money through Tips who do not live in Vegas. A huge majority of those people are barely making it.

    • #15
  16. OldPhil Coolidge
    OldPhil
    @OldPhil

    cdor (View Comment):

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    I’m sure that you realize there are a lot of people that earn money through Tips who do not live in Vegas. A huge majority of those people are barely making it.

    So the cooks, dishwashers, etc. in the kitchen pay tax on 100 percent of their earnings, but the servers out front pay tax on only what — 20 or 30 percent of theirs? As the cool kids say, yeah, no.

    • #16
  17. Bob Thompson Member
    Bob Thompson
    @BobThompson

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    I’m sure that you realize there are a lot of people that earn money through Tips who do not live in Vegas. A huge majority of those people are barely making it.

    So the cooks, dishwashers, etc. in the kitchen pay tax on 100 percent of their earnings, but the servers out front pay tax on only what — 20 or 30 percent of theirs? As the cool kids say, yeah, no.

    Sooner or later, you’ll realize what a bad approach taxing individual income is for America’s limited federal government.

    • #17
  18. kedavis Coolidge
    kedavis
    @kedavis

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    I’m sure that you realize there are a lot of people that earn money through Tips who do not live in Vegas. A huge majority of those people are barely making it.

    So the cooks, dishwashers, etc. in the kitchen pay tax on 100 percent of their earnings, but the servers out front pay tax on only what — 20 or 30 percent of theirs? As the cool kids say, yeah, no.

    I wonder if the cooks etc would be willing to give up their known pay, for the uncertainty of tips, even if untaxed?  If so, seems like they wouldn’t be cooks etc, they’d be servers already.

    • #18
  19. The Reticulator Member
    The Reticulator
    @TheReticulator

    Nanocelt TheContrarian (View Comment):
    The need for tax exempt bonds would disappear at a Federal level. The distortions of credit misapplication and the economic harm therefrom would also disappear. And the economy would be better off, and everyone would be better off. And the municipalities would have to justify their bond issues on something other than tax advantage, like the support of the community with a higher expected benefit to the municipal investment.  States would likely continue to provide tax exemptions as they would be taxing citizens to pay their federal tax allotment, but they, and the municipalities, would be much closer to the citizens that they have to answer to in elections. In my view, corruption would decrease as would economic vetting and improved investments.  Plus the competition between States would tend to blunt the States gaming the system, like imposing high tax rates then giving tax exemptions for municipal bonds. Citizens could relocate or buy the bonds to avoid the high taxes. The wealthy purchasing the bonds would have to live in the State to get the benefit, or do business in the State to get the benefit, and be subject to the high tax jurisdiction of the State. And would have to live with the consequences of their investment. I am not claiming the system would be fair. Just more fair, reasonable, and less economy distorting than our current federal tax system, which is more convoluted than the Gordion knot. And yes, it would take an Al.exander to slice through that monstrous tax code, which no on can unravel piecemeal. But this would be an initial sword strike on that Gordon knot of federal taxes.

    It seems that you understand the role of tax-exempt munis about the same way I do.  However, when you say “the need for tax exempt bonds would disappear,” I am reminded of Karl Marx’s idea that under socialism/communism things would be so wonderful that the state would wither away.  

    • #19
  20. W Bob Member
    W Bob
    @WBob

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    I can see the ads now: an effete waiter at a high end restaurant in New York pays almost no federal income tax on an income equal to the salary of a union auto worker in Detroit. 

    • #20
  21. cdor Member
    cdor
    @cdor

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    cdor (View Comment):

    OldPhil (View Comment):

    I’m all for completely revamping the federal tax system, roto-rootering it, whatever you want to do to it and/or call it. But how is Trump’s call to eliminate taxes on tips while campaigning in Vegas any different than Biden’s craven student loan fiasco(s)? He’s trying to bribe a specific category to get votes.

    Tips are income, in some cases a very large part of income, and if we have an income tax, why should one category get a special benefit? Yes, I know there are uncountable loopholes already. Just overhaul the entire system.

     

    Just overhaul the entire system? I agree old Phil, It is catering to one group for votes. I also agreed that the system is full of loopholes. It just so happens that this one group doesn’t get any of those loopholes . Until now. Honestly, I feel a certain poetic justice that while Biden is giving 5000 thousand and $200,000 payoffs to people who Acquired an insane amount of debt to go to college, Trump is giving benefits to those on the other end of the pay scale who can really, really benefit. Maybe it just shows you where his heart is. I hope a lot of people notice.

    There are many groups that deserve tax breaks, or even better, a completely fair tax system. Vegas tip workers make a ton of tip money; they’re not scrabbling for a living.

    I’m sure that you realize there are a lot of people that earn money through Tips who do not live in Vegas. A huge majority of those people are barely making it.

    So the cooks, dishwashers, etc. in the kitchen pay tax on 100 percent of their earnings, but the servers out front pay tax on only what — 20 or 30 percent of theirs? As the cool kids say, yeah, no.

    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote. 

    • #21
  22. The Reticulator Member
    The Reticulator
    @TheReticulator

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote. 

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    • #22
  23. kedavis Coolidge
    kedavis
    @kedavis

    The Reticulator (View Comment):

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote.

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    He may.  But first he has to get elected.

    • #23
  24. cdor Member
    cdor
    @cdor

    The Reticulator (View Comment):

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote.

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    What he did wasn’t very complicated. He eliminated hundreds of regulations, opened up drilling and production of oil and natural gas, negotiated equitable trade deals with China, Europe, and Mexico, and, in about the only thing the Republican Senate and House majority of his first two years produced, he landed a new tax law that reduced business income taxes by almost half, which ignited our economy. Oh, and he didn’t start any wars.

    • #24
  25. cdor Member
    cdor
    @cdor

    cdor (View Comment):

    The Reticulator (View Comment):

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote.

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    What he did wasn’t very complicated. He eliminated hundreds of regulations, opened up drilling and production of oil and natural gas, negotiated equitable trade deals with China, Europe, and Mexico, and, in about the only thing the Republican Senate and House majority of his first two years produced, he landed a new tax law that reduced business income taxes by almost half, which ignited our economy. Oh, and he didn’t start any wars.

    As KC said, the first thing he did was get elected!

    • #25
  26. Bob Thompson Member
    Bob Thompson
    @BobThompson

    kedavis (View Comment):

    He may.  But first he has to get elected.

    •  

    THAT is exactly what this post is about. Trump’s not losing anyone who understands that.

    • #26
  27. kedavis Coolidge
    kedavis
    @kedavis

    Bob Thompson (View Comment):

    kedavis (View Comment):

    He may. But first he has to get elected.

    •  

    THAT is exactly what this post is about. Trump’s not losing anyone who understands that.

    And if anyone decides they can’t vote for Trump because of the tips thing, well…  “I’ve got your tips RIGHT HERE!!!”

    • #27
  28. Nanocelt TheContrarian Member
    Nanocelt TheContrarian
    @NanoceltTheContrarian

    The Reticulator (View Comment):

    Nanocelt TheContrarian (View Comment):
    The need for tax exempt bonds would disappear at a Federal level. The distortions of credit misapplication and the economic harm therefrom would also disappear. And the economy would be better off, and everyone would be better off. And the municipalities would have to justify their bond issues on something other than tax advantage, like the support of the community with a higher expected benefit to the municipal investment. States would likely continue to provide tax exemptions as they would be taxing citizens to pay their federal tax allotment, but they, and the municipalities, would be much closer to the citizens that they have to answer to in elections. In my view, corruption would decrease as would economic vetting and improved investments. Plus the competition between States would tend to blunt the States gaming the system, like imposing high tax rates then giving tax exemptions for municipal bonds. Citizens could relocate or buy the bonds to avoid the high taxes. The wealthy purchasing the bonds would have to live in the State to get the benefit, or do business in the State to get the benefit, and be subject to the high tax jurisdiction of the State. And would have to live with the consequences of their investment. I am not claiming the system would be fair. Just more fair, reasonable, and less economy distorting than our current federal tax system, which is more convoluted than the Gordion knot. And yes, it would take an Al.exander to slice through that monstrous tax code, which no on can unravel piecemeal. But this would be an initial sword strike on that Gordon knot of federal taxes.

    It seems that you understand the role of tax-exempt munis about the same way I do. However, when you say “the need for tax exempt bonds would disappear,” I am reminded of Karl Marx’s idea that under socialism/communism things would be so wonderful that the state would wither away.

    But he also said the state would impose a highly progressive income tax and that the State would own and control all the means of production. So he was either completely confused or lying through his teeth. If the workers own and control the means of production and the workers are the State, the he was indeed trying to bamboozle everyone.He fully succeeded in bamboozling the intelligentsia, which fell all over itself to be bamboozled (with very few, like Thomas Sowell, managing to realize that they had been bamboozled).

    Imagine what would happen if there were no capital gains taxes, no need for tax shelters, no need for tax write offs for business loses or bankruptcies. No need for tax incentives to attract businesses. The recent SC decision on taxing foreign investments would never have had to happen.There would be such a simplification of financial incentives that the ecocmy would soar.

    Human prosperity would be greatly enhanced.

    But that is the opposite of what our political masters want. They want us poor and dependent.

    • #28
  29. The Reticulator Member
    The Reticulator
    @TheReticulator

    kedavis (View Comment):

    The Reticulator (View Comment):

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote.

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    He may. But first he has to get elected.

    So he’s going to get elected by telling people it’s going to be a different Donald Trump this time?  

    • #29
  30. kedavis Coolidge
    kedavis
    @kedavis

    The Reticulator (View Comment):

    kedavis (View Comment):

    The Reticulator (View Comment):

    cdor (View Comment):
    This has gotten a bit into the weeds. Every restaurant has their own system, but in most restaurants the tips are put in a pool and distributed to the bussers and dishwashers. The cooks are generally on an entirely different pay level. But this is not about philosophy or theory. This is about a campaign for the country. I really do not care if Trump throws a bone to a group of low wage folks to get their vote.

    I wish Trump had confidence that he could repeat the policies from his first administration that brought about better wages for low wage folks.

    He may. But first he has to get elected.

    So he’s going to get elected by telling people it’s going to be a different Donald Trump this time?

    I just don’t think it makes sense to assign some kind of final meaning to something that hasn’t even been officially proposed yet.  But people are assuming that it will apply to ALL tips for ANY person who gets “tips” no matter WHAT their basic income might be or what market they’re in…  ALL of that stuff gets worked out later.

    • #30
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