Barb: Both political parties have come out with a “no taxing tips” policy. This is a bad idea.

Instead of giving a tax break to one group of workers, we should just pay them a living wage. The minimum wage in Michigan for a waitress is 38% of the standard minimum of $10.33, or $3.93. They allow this lower minimum because of receiving tips.

The whole tipping system we have in the United Stated is out of control. No matter where you go, the tip jar is out. The amount to tip has gone from 5% to 10%, 20% or 25% of the table receipt. Businesses limit the expense accounts to 18%. When the Federal Minimum Wage started in 1938, why was an exception for wait staff implemented? It was said the tip would ensure good service. Really, how often have you bumped the tip by 5% due to good service? My belief is it was made low due to the majority of wait staff at that time being women. You know, not the primary income earners in the family.

Why is it a bad idea? Let’s compare two examples. Let’s say there are two individuals: one that works at a convenience store and the other at a restaurant as a waitress. The store clerk is getting $10.33 per hour and the other getting $3.93 per hour. The clerk works 40 hours a week, 52 weeks and has a yearly income of $21,486. Now the waitress works the same 40 hours and 52 weeks; their income is $21,486, too; $8,174 from wages and $13,312 from tips. Both individuals get paid the same, but the clerk has to pay more taxes. The income for both individuals is in the 12% tax bracket; the store clerk pays $2,578 in taxes and the waitress pays only $981. This is not fair. And what about the fast-food workers or any other person that makes minimum wage?

My suggestion is to move away from this whole tipping culture we are in and just pay people a living wage. Will prices at restaurants go up? No. If I pay, say, $16.46 ($13.95, plus an 18% tip) for an order, please just charge me the $16.46 and pay a living wage.