Ron Paul introduces "Tax Free Tip" Legislation

[ZeroPointMachine]

[ QUOTE ]
Introducing the Tax Free Tips Act
Ron Paul Speech to Congress, September 25, 2007

http://www.ronpaullib...

Madam Speaker, I rise to help millions of working Americans by introducing the Tax Free Tips Act. As the title suggests, this legislation makes tips exempt from federal income and payroll taxes. Tips often compose a substantial portion of the earnings of waiters, waitresses, and other service-sector employees. However, unlike regular wages, a service-sector employee usually has no guarantee of, or legal right to, a tip. Instead, the amount of a tip usually depends on how well an employee satisfies a client. Since the amount of taxes one pays increases along with the size of tip, taxing tips punishes workers for doing a superior job!

Many service-sector employers are young people trying to make money to pay for their education, or single parents struggling to provide for their children. Oftentimes, these workers work two jobs in hopes of making a better life for themselves and their families. The Tax Free Tips Act gives these hard-working Americans an immediate pay raise. People may use this pay raise to devote more resources to their children's, or their own, education, or to save for a home, retirement, or to start their own businesses.

Helping Americans improve themselves by reducing their taxes will make our country stronger. I, therefore, hope all my colleagues will join me in cosponsoring the Tax Free Tips Act.

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H.R.3664 : To amend the Internal Revenue Code of 1986 to provide that tips shall not be subject to income or employment taxes.

Sponsor: Rep Paul, Ron [TX-14] (introduced 9/25/2007) Cosponsors (None)
Committees: House Ways and Means
Latest Major Action: 9/25/2007 Referred to House committee. Status: Referred to the House Committee on Ways and Means.

LINK

http://thomas.loc.gov...
Select Ron Paul in the drop down menu


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Something to grab the attention of any poker dealer or cocktail waitress.

[Cactus Jack]

...and shuttle bus drivers. /images/graemlins/laugh.gif

[YoureToast]

imho, this makes him look silly.

[BBMW]

No. But it opens a wide world of loopholes, and would push the concept of tip driven income to jobs never thought of before.

[Uglyowl]

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imho, this makes him look silly.

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Agreed

[Legislurker]

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imho, this makes him look MORE SILLY.

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FYP.

[whangarei]

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Since the amount of taxes one pays increases along with the size of tip, taxing tips punishes workers for doing a superior job!

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This is really bad economics

[Jimbo]

Guess he hasn't figured out that everyone would just tip 40% less. /images/graemlins/smile.gif

Jimbo

[DeadMoneyDad]

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No. But it opens a wide world of loopholes, and would push the concept of tip driven income to jobs never thought of before.

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I can see the want ads now.

"CEO wanted, must be willing to work for tips....."


D$D

[Tuff_Fish]

There is actually sound economics in this proposal.

There would be a very modest hit on revenue, but a rather large multiplier effect on the economy.

Earned income in the hands of the "working class" is much better overall than money in the hands of the government.

Tuff graduate of econ 101

[DeadMoneyDad]

[ QUOTE ]
There is actually sound economics in this proposal.

There would be a very modest hit on revenue, but a rather large multiplier effect on the economy.

Earned income in the hands of the "working class" is much better overall than money in the hands of the government.

Tuff graduate of econ 101

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Well when you get past the 101 level you learn that no economic activity happens in a class room.....

In the real world the vast majority of tips are now not taxed. The IRS has tried and likely collects more now than it used to collect on as a whole.

But look at the net effect on say the SS earnings for the tip earner. By not reporting on or taxing the tips they are willing to currently report, each individual now no longer gains the benifits of the earnings nor benifits the entire group who think they might get a dime out of SS.

Off the books economys cause many problems for governments and most directly impact the working class more than others. The rich are always going to be able to make some economic decisions with taxes in mind, where as a working man's economic decisions very rarely have positive tax consequences if many choices at all.

So yes in economics 101 money out of the hands of governement is indeed good, because the government is not as effecent as the private sector in it's utilization of the same dollars. But Paul's plan removes an important portion of lower class wage earners income from taxation now as well as removing it from over all SS earnings over their life time. If he was smart he'd suggest fully reporting it for SS earnings or even SS taxes but NOT income taxes.

Your average tip earner isn't pushing up against ever higher tax brackets as it is, many working part time or while in school. The actual tax bite out of their reported tip income is more than likely received as an annual tax refund now. I doubt there is one tip earner who is subject to AMT calculations.

IMPO he looks like a fool on a number of counts, not the least of which is courting a younger and less affluent demographic that is less likely to be registered to vote, and even less likely to vote on election day.


D$D

[Legislurker]

My god, tip earners get an awesome tax treatment. The assessment by the IRS is always way way under whats earned. They rarely make top tier high income tax paying brackets. I highly doubt the effect on G either way is going to change Y.
Even when Y goes down because G goes up it doesnt include the cost of not having enough G for whats needed. Its a vote ploy, not economics. Maybe GWB vodoo economics. If you don't think the poor should pay the modicum of taxes they do now, then vote that way. Its laffable to say ANYTHING RP proposes is good economics. He probably has a picture of Calvin Coolidge somewhere in his office.

[Uglyowl]

Depending on the business, lots of tip earners have a lot of tax free (unreported) income as it is /images/graemlins/smirk.gif

[Sifmole]

You all understand that this just means the multi-million dollar CEO bonuses will just be re characterized as "tips" for the CEO's wonderful performance. right?

[kagame]

"Paul adheres to the economic philosophy of the Austrian School of economics and has authored several books on the subject. He has pictures of classical liberal economists Friedrich Hayek and Ludwig von Mises hanging on his office wall[30][31]."

http://en.wikipedia.org/wiki/Ron_paul

[DeadMoneyDad]

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"Paul adheres to the economic philosophy of the Austrian School of economics and has authored several books on the subject. He has pictures of classical liberal economists Friedrich Hayek and Ludwig von Mises hanging on his office wall[30][31]."

http://en.wikipedia.org/wiki/Ron_paul

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Well he must have been asleep the many days the effects of his suggestion that the US go back to any semblance of a gold standard.

After we pay China for our worthless paper in GOLD there will be nothing left over....

D$D

[surftheiop]

well Ron Paul wants less income to be taxed so this would go right along with what he is trying to accomplish i believe

[kagame]

gold standard could be applied to our money at a much lower rate than it was in the past, making it worth exactly what its worth for gold on the open market, doing nothing but removing the ability for the fed to PRINT money and devalue the currency any further! why does no one understand this?

[Coy_Roy]

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gold standard could be applied to our money at a much lower rate than it was in the past, making it worth exactly what its worth for gold on the open market, doing nothing but removing the ability for the fed to PRINT money and devalue the currency any further! why does no one understand this?

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They don't understand, because they're not even aware that the fed is devaluing the the currency.


http://infowars.com/images2/cartoons/260907fedres_dees.jpg

[DeadMoneyDad]

[ QUOTE ]
[ QUOTE ]
gold standard could be applied to our money at a much lower rate than it was in the past, making it worth exactly what its worth for gold on the open market, doing nothing but removing the ability for the fed to PRINT money and devalue the currency any further! why does no one understand this?

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They don't understand, because they're not even aware that the fed is devaluing the the currency.


http://infowars.com/images2/cartoons/260907fedres_dees.jpg

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You seemed to have missed my understanding of economics.

I hope to hell Paul's suggestion that going any where near the gold standard gains wide acceptance, let alone any hearings, if it actually came to pass I'd be happier than anyone I know.

I'm so over loaded in gold related invenstments a small precentage move in gold and I could pay a buy-in to a couple of WSOP type events. A nice move and I could go on a private jet.

I have a good idea of how badly the Fed is devaluing the US currency. Hell I'll go you one further our school system has so devalued this country all I have to decide is which foriegn currency to cash into when I get out of my gold positions. The American people have gotten so lazy and litigious in general that they expect everyone or at least some one to pay for any stupid thing they do to themselves.

I don't think the US is comming fully back any time soon. Well my investments are set up so if it happens in my lifetime I had to make some minor changes.

My kids are on their own. Well they'll get whatever I don't manage to spend and the IRS doesn't get.

Personally my philisophy of proper financal management is based on the dream of the last check I write bouncing.


D$D

[Coy_Roy]

Just so you know DMD, I was referring to they in the general sense and not to you specifically.

[DeadMoneyDad]

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Just so you know DMD, I was referring to they in the general sense and not to you specifically.

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Sorry you hit a nerve.

You're right I over reacted.


D$D

[kagame]

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Personally my philisophy of proper financal management is based on the dream of the last check I write bouncing.
D$D

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Fantastic /images/graemlins/laugh.gif

[Jimbo]

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gold standard could be applied to our money at a much lower rate than it was in the past, making it worth exactly what its worth for gold on the open market, doing nothing but removing the ability for the fed to PRINT money and devalue the currency any further! why does no one understand this?

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Because it is not accurate. The US dollar will devalue untill our exports begin to exceed out imports. Drilling for more oil in US territory would lead to an immediate increase in the value of the dollar worldwide. The FED has very little influence on the dollar value, increasing M2 only affects inflation but even then interest rates have a much greater impact.

The main culprit in the decline of the dollar if you insist on blaming a single entity should be placed on the IMF. Do a little study on why and get back to me.

Jimbo

[DeadMoneyDad]

[ QUOTE ]
[ QUOTE ]
gold standard could be applied to our money at a much lower rate than it was in the past, making it worth exactly what its worth for gold on the open market, doing nothing but removing the ability for the fed to PRINT money and devalue the currency any further! why does no one understand this?

[/ QUOTE ]

Because it is not accurate. The US dollar will devalue untill our exports begin to exceed out imports. Drilling for more oil in US territory would lead to an immediate increase in the value of the dollar worldwide. The FED has very little influence on the dollar value, increasing M2 only affects inflation but even then interest rates have a much greater impact.

The main culprit in the decline of the dollar if you insist on blaming a single entity should be placed on the IMF. Do a little study on why and get back to me.

Jimbo

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I blame our crappy school system for creating a number of generations of economically illequiped mindless consumers.

Our economy is on such shaky ground I'm really scared for most of them!

I live in a nice little neighborhood but I'm the only one on my street that isn't sitting on negative equity in their home, well that I know of....

Where was the <u>government</u> to save those people from <u> betting their largest single lifetime investment their homes</u> on the come? Where were the protect us from ourselves crowd when the <u>sub-prime predators were running their rigged game ?</u> 125% credit lines with a hidden $20k~$30k finders fee for the mortage broker!! Where was the FoF when the CRACK of credit <u>the credit card companies</u> took advantage of the housing boom to create a new bunch of DEBT burdend slaves . In this country you used to be able to buy a person as a slave by buying their debt, guess you still can!

Most of these poor ba$tards are out getting second jobs to pay the note on their homes full of crap they bought on those ever increasing credit limits, thanks to the re-fi pay-offs, and they are going to spend 30 years paying for all those impulse purchases.

What did Yackoff used to say, "My God what a country??"

Oh that's right they were saving poker players from themselves..............and the evils of gambling and the crack of gambling poker......

Read this and see what you think of my gold portfolio, my wife has wanted to sell her SUV for a new turbo Beatle convertible. I'm going to the dealership this afternoon!

$100 a barrel for oil???? WSJ (http://online.wsj.com/article/SB119102487310743331.html?mod=googlenews_wsj)


D$D