A possible new slogan: “Tell the truth”  

Almost every presidential campaign has slogans. One that could be repurposed for today’s presidential election is Lyndon Johnson’s anti-Goldwater slogan, “In your guts, you know he’s nuts.” Johnson’s far more lasting slogan was “LBJ for the USA.” A lot of slogans promise food such as “Four more years of the full dinner pail” from William McKinley in 1900 or “A chicken in every pot” from the Hoover campaign in 1928. Others simply invoke food such as “Not just peanuts” and “Peaches and cream” both from the Carter/Mondale ticket in 1976. Some are very clever. “Keep cool and keep Coolidge.” was the 1924 slogan of Calvin Coolidge. “Happy days are here again” was the 1932 slogan of Franklin Roosevelt, followed by his 1940 slogan, “Better a third termer than a third rater.” It is interesting that “Make America great again” was actually the Reagan/Bush slogan in 1980. Recently, the Trump and Harris campaigns have promised something both silly and dangerous, which is rapidly becoming a slogan, “No taxes on tips.” With all the policy positions both campaigns need to be laying out, one might wonder how this one came to the fore, but more important is that this is not good tax policy. 

Right now, about 4 million people work in tipped occupations, many of whom are allowed to be paid the sub-minimum wage of $2.13 an hour because, the thinking goes, their tips bring them up to a normal salary. None of us oppose giving low-wage workers more money. The problem with doing that by not taxing their tips is that the boost it gives is very uneven. In the hospitality industry, workers can make very different amounts and so the amount of this exemption will vary widely. Bartenders in high-end restaurants will often be tipped better than waiters at a diner, for example. Teaching assistants, home health care workers and other low-paid workers who are not tipped but earn the same as a waiter with tips will pay much more in tax if this policy is adopted. Most egregious will be certain kinds of highly-paid professionals who will change their bonuses or some of their fees into tips and thus avoid income tax. 

There are a host of easy-to-implement ways to increase the wages. Eliminate the sub-minimum wage so that everyone must be paid at least the federal minimum wage which is $7.25 per hour. Then after that, raise the minimum wage (which has not changed since 2009), to at least $15 per hour. Policymakers can also expand the child care credit.

Some people might wonder what those of us who are not low-wage workers or tipped workers should do about these policies? 

First, do not automatically support any policy that promises tax relief. Look at the policy and see if the tax exemptions that are being promised are fair to everyone. Ask what will not be paid for without this tax money? Many of us are very concerned about how much of our total tax bill goes to weapons but our taxes also pay for schools, streets, fire protection and a host of other important services. Is it really worth the cost to the common good? 

Second, familiarize yourself with the rudiments of tax policy. Many of us think, “So boring” or “I can’t understand any of it.” But it is not boring, and you can understand it. Taxes are a mirror of community values. What are your values?

Finally, ask candidates about the tax policies they support and ask them to explain the policies to you in simple, clear language.  

Harris and Walz jumped on a bandwagon with their “No taxes on tips” that is not going to end well. But an informed, interested electorate can ensure that Harris and all candidates running on a progressive platform, do not need to promise problematic tax cuts in order to curry votes. 

For the most recent details on the “No tax on tips” and disturbing background on the history of tipping, see The Guardian article, “Is ‘No tax on tips’ a distraction from the fight to end sub-minimum wages?“