Eliminating taxes on tips is not a new concept but this year it is an idea that is supported by both Donald Trump and Kamala Harris.
According to experts at Virginia Tech, the idea could benefit service workers but the overall impact may not be that dramatic.
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There are around four million workers and tips make a majority of their income but more than a third don’t earn enough to end up owing federal taxes, Virginia Tech says.
According to experts people tip or don’t on a variety of factors.
Sheryl Ball who studies behavioral economics in the College of Science at Virginia Tech says the psychology behind tipping is complicated.
“In behavioral economics, we like to think of this as reciprocity,” she said. “Someone does a good job of taking care of you when you go to a restaurant or ride in a taxi cab, so you want to reward them for their good work.”
Their are multiple motivations including, knowing the wage of someone who makes tips is low, technology factors with establishments using I-pads with suggested tip amounts and tipping makes people feel good.
What do you think of tipping culture, and eliminating taxes on tips?