Its absolutely amazing that many servers feel they shouldn't have to pay their fair share in taxes. I pay taxes, why shouldn't my server? I now refuse to tip in cash. As a matter of fact, if the governement did away with cash, maybe this country wouldn't be in such bad shape since they other half of the country (servers, hair stylists, bartenders, etc) would be paying their fair share of the tax burden.

Glad I don't have to make this choice, since we always pay for meals in cash. We decided long ago that we don't like paying credit card bills for something we consumed a month or so earlier.

An interesting story about owners taking the tips from employees. One well known Timonium restaurant had a coat check room with a door cut in half. The bottom part of the door had a shelf with a slot cut into it labeled tips. Underneath the shelf was a locked box which the owners emptied and helped themselves to the contents.

I generally tip in cash for just these reasons. The corporations cheat on their taxes, why shouldn't someone making $2/hr?

Mostly, though, I'm worried about cc transaction fees and unscrupulous owners not giving the money to the server at all. I've been a regular at more than one place where the rumours were that if you didn't hand cash directly to the person who waited on you, the owner would take it all and keep it.

This is completely absurd. If I go to a restaruant and use a credit card, I'm going to leave the tip on the credit card, and that's all. I'm sure as heck not about to also leave a smaller tip in cash because i'm worried the owner of the restaurant might use the tip to pay for the credit card fees. If that's indeed happening at restaurants that's not my problem, and i'm not about to tip extra in cash to subsidize a restaurant owner potentially ripping off a server.

Steve, I don't think that "subsidize" means what you think it means.

If I knew for a fact the owner of restaurant was cheating the servers I would never set foot in the place again. I wish MrEd would identify the place he mentioned. Honest businesses need to be frequented. Crooks need to be run out of town.

Ben your argument is exactly why I support a national sales tax and the elimination of income taxes. It is the only way to tax the underground economy.

Aw, EEL, why for do you want to go and tax the underground economy? It'll just force all those scurrilous deadbeats into the black market. And then you have to declare a War on Tipping. There'll be gunfights in the diningroom. Tell you what, just knock a third off the tip and send it to the G. Save a boatload of paperwork mon ami.

Legalize drugs and prostitution, tax them. Would increase the Baltimore tax base no end.

I'm in favor of replacing income taxes with sales tax, but I fail to see how that would tax the underground economy. Just as drug dealers are not reporting their taxable income, I doubt they would be assessing a sales or value added tax onto each drug transaction. I imagine if our drug dealers did start charging such as tax, addicts would just go to Delaware to get their fix.

Now, if the underground economy is just the underground cullinary economy, well than maybe this tax plan will work.

I don't understand some of the comments/concerns about restaurant owners stealing a server's credit card tips. When I was a server we took our credit card tips home with us every night, the same way we did our cash tips. Throughout the night anytime someone paid for their meal in cash, I carried the money in my server's pouch. So at any given time, the money in my pouch was about 85% restaurant money (representing the portion of the cash left to pay for the meal) and 15% my money (the portion of the cash left as my tip). At the end of the night, I'd add up the tips listed on the credit card receipts and take that amount of money from the cash that otherwise belonged to the restaurant. I also took the 15% that was my cash tips. So I got my credit card tips on the front end, out of the restaurant's money, and the restaurant, in turn, got all the money from the credit card company. My biweekly pay check had no money in it other than my hourly pay. With this system, there was no way the restaurant could take my money. I have only worked in this one restaurant, but I imagine others work the same way....

I posed this question to a server (I believe it was in the infamous Springs1 topic) and she said she preferred cash. So that's how I tip now.

Illegal transactions would not be taxed but when the profits from such transactions were used to purchase legal items the sales tax would be collected. By the way I am all for legalizing drugs and prostitution.

Since the FDA is soon to get authority over tobacco, would they also get it for marijuana if it were legalized? And Heroin, Meth, Cocaine, Crack and other now illegal drugs? Would the Heroin have to conform to the original Bayer patent? Would there be such a thing as U.S.P. Crystal Meth?

Plus, would the Feds and States be tax them? Would they be by prescription only or could you just go to a licensed "Drug Store"? Imagine the taxes and fees that could be raked in.

Illegal transactions would not be taxed but when the profits from such transactions were used to purchase legal items the sales tax would be collected.

How is that different from what we have now? Drug dealers avoid income tax. But when they buy groceries, they pay sales tax. Servers who don't report cash tips acutaly have MORE money to spend and so they generate MORE sales tax.

BTW...I didn't think anybody could damage the Republican Party beyond the point it has already been damaged, but EEL found a way, when he came out for smack and hookers.

I've been told that the IRS can audit a server's checks paid by credit card, determine the average tip % on those checks, and then assume that tip percentage for all of the server's checks.

So being the subversive that I am, I take the opposite approach to FH Jim. I tip just a couple of dollars on the credit card when paying the check, and pay the rest of the tip in cash. In case the server is ever questioned by the government, I've helped drive down the server's average tip.

I hadn't ever thought about the side benefit of protecting the server from an unscrupulous owner.

I'm for smack and hookers, Bucky, and I'm certainly no Republican. Of course, I'm no Democrat, either.

Sales tax is regressive. It taxes all or nearly all of the money that goes through the hands of the poor while taxing only a small fraction of the money that goes through the hands of the rich. This means the poor end up paying far more than their fair share of taxes.

I don't understand why taxes are considered an unmitigated evil. I like things like paved roads, ambulances, fire trucks, libraries, research, space flight and health care. I like safety nets. I'm quite willing to pay for all of these, just like I'm willing to pay more for prime aged steak than I am for a burger from 5 Guys.

I'm all in favor of "sin" tax. Take trade off the street and put the money into legal enterprises and tax it. Great idea!

Unfortuately, our President doesn't agree.

When someone convinces me why I should care what an individual smokes, snorts or injects and how it can be prevented I may reconsider my opinion. This so called war on drugs has not been so successful.

In Maryland we don't charge sales tax on groceries. In the earlier post I was referring to instituting a federal sales tax to replace federal income tax. And I would extend it to real estate and services. Some may see this as regressive but I like it better than the rich using loop holes and tax attorneys to avoid income tax and those who work for undocumented cash paying very little in federal taxes.

I am surprised that there has not been more of an outcry over the increase in the state tax on alcohol and the nearly tripling of the federal excise tax on tobacco. These are definitely taxes that strike at the lower income brackets. If I understand the alcohol tax correctly it is the same for a bottle of $10 wine as it is for a bottle that sells for $100 since it is charged at a flat rate per gallon.

Bucky's attack makes me wonder again just what was in the post that EL rejected.

There has been an outcry over the increases in the state taxes on smokes and booze. I hear it all the time on the city buses.

Columnists don't ride city buses, I guess.

This whole post is another reason why I'm not dining out as frequently as I used to. We've gone over tipping ad nauseum. I tip 20% unless the service was abysmal, then I tip 15%. I never thought about what the owners take, and I don't want to think about that. I just want to go out for dinner and have mediocre service so I can feel good about not cooking dinner for myself.

I generally tip 25-30%. I know many people in the service industry, and I know how hard it is. I have lunch at a neighborhood restaurant and usually get the same thing. The total comes to $14.02, and I leave $20. I ate there recently and the server was rude to the point if being nasty. I left $14.05

I forgot to mention that it was a different server. Maybe she was new, maybe she was having a bad day, but I felt that the nastiness was inexcusable.

We could use a 'consumption tax' - not a 'sales tax to replace the income tax.
The tax rate on necessities would be low (so it is not regressive) - the consumption tax rate on porsches, champagne, fur coats, diamonds, et cet. would be high... so it is progressive... it would be easy and clear cut (so it is unlikrely to happen).

Alcohol taxes are calculated by the state and federal government based upon proof gallons. So the pre-sale tax for two $6 bottles of triple sec is the as that of a $400 bottle of aged rare whiskey. They are based on the amount of sin in the bottle. Sales taxes on the purchase are another matter. This kind of tax isn't just regressive, it's uber-regressive.
http://www.ttb.gov/tax_audit/atftaxes.shtml

The federal tax on an 80 proof bottle of liquor is $2.14 regardless of price. Wine is taxed similarly with higher rates for higher alcohol content. Beer is taxed the same regardless of alcohol content. The fed tax is 5 cents per 12 ounce container, but only 2 cents for small breweries.

Wine tax is $0.21 / 750 ml bottle if 14% alcohol or less and $0.31 if 14-21%.

Small breweries get a discount on taxes, so that is what I would call business-progressive.

Wow, I have been having a neuron-frying crippling anxiety attack for the past six hours or so and working up some numbers seems to have turned it around. Weird. I guess it makes you feel in control of something, even if it is artificial. Math ... the new Xanax.

Maryland adds an additional 9 cents per gallon for beer, which is about one cent per bottle.

I'll bet these numbers are a lot smaller than you thought.

The very good thing about taxing alcohol content instead of price is that it is anti-inflationary. The price of beer may have gone up since 1991 but the added tax remains 9 cents per gallon.

I do not personally know of any restaurant owner that takes a share of employee tips for any reason. They should withold taxes from the paychecks based on the employees hourly wages AND declared tips (cash & credit), as required by law. It should be pointed out that the restaurant owner does pay fees to the credit card companies for not only the amount of the sale, but the tip and the sales tax.

Silly rabbi trigs are for kicks.

Here's the deal: taxes are a zero sum game. When you give your server cash so that he can cheat on his taxes, YOU pay more, It all goes into the same pot and if the pot doesn't get filled up then your taxes go up. It's basic game theory.

What's with the beatification of waiters and waitresses?

I don't think taxes are a zero sum game at least not in the long term. I think that taxes and/ or deficit spending (future taxes) must equal current spending, but the spending level can go up and down. Of course as we replace more discretionary spending with mandatory spending it becomes harder to control the spending mechanism.

I can not believe how strongly some people feel on this subject. I have been in the biz for over 30 years, and still make $3.18 an hour, no benefits, no vacations, no 401k and my paycheck is ALWAYS $0.00 so I rely on tips to pay my bills. ALL restaurant with a POS system (touch screen) take as much as 5% of credit card tips to cover the expense, it's built in and can bee seen on the server report. is it that big of a deal for you to leave us cash? is it going to ruin your day or cause you to loose sleep? no? well guess what, bad tips cause us to have a bad day and loose sleep and yes I have worked for owners who stole my tip money, as a matter of fact there are 3 restaurant owners who still owe me money. keep in mind, the tip you leave on a credit card, 5% goes to the house, then 3% of our total SALES goes to the busboy/backwaiter which can be as high as 20% and as low as 10% of our tips, then the bartender get 1% of our sales, another 5 to 10% of our tips. then, on a regular 8 hour shift, we have to eat, but we get no breaks, and cant leave the restaurant, so we order something to eat. yes some places offer 50% off employee meals but aside from brown bagging it we have to order there. we give the restaurant the best hours and days of the week, nights and weekends and yet some of you still want to cheap out on the tip, credit card tips cost us money, cash does not and if that is a problem for you, pull around to the drive thru please, oh yea, we dont have one, keep on driving instead.

I'm a server at a restuarant and when people use credit cards, yes, it does cost me money. My employer takes a credit card processing fee off of our total credit card sales. That's right, not just off our credit card tips, but the WHOLE thing. So if your $100 meal is on the credit card, but you tip in cash, my employer will still take $2 (2%) out of my tips at the end of the night.

Oh, and for those who are concerned about my taxes... I'm a college student who gets loans in order to attend as a full-time student so I can keep health insurance. My employer also taxes me on my total tips (before they take away 2% of my TOTAL credit sales - which actually averages out to be 15% of my tip). I also claim my cash tips so that way I have a larger income to put down on my housing applications off-campus.

So, I'd appreciate cash. Thanks.

I'm a server at a restuarant and when people use credit cards, yes, it does cost me money. My employer takes a credit card processing fee off of our total credit card sales. That's right, not just off our credit card tips, but the WHOLE thing. So if your $100 meal is on the credit card, but you tip in cash, my employer will still take $2 (2%) out of my tips at the end of the night.

Oh, and for those who are concerned about my taxes... I'm a college student who gets loans in order to attend as a full-time student so I can keep health insurance. My employer also taxes me on my total tips (before they take away 2% of my TOTAL credit sales - which actually averages out to be 15% of my tip). I also claim my cash tips so that way I have a larger income to put down on my housing applications off-campus.

So, I'd appreciate cash. Thanks.

Your employer sucks. Tell us which restaurant it is and I promise not to go there ever again. Well, unless it's Michael's Steak and Lobster. Then I would just tip you in cash and a little extra to cover my credit card processing fee.

BaltiMoron - it sounds like the real problem is the restaurateur and their crappy policy and/or the pos POS system, not the method of payment.

My friend works at restaurant where his boos is taking about 10% for credit card fees I don`t bolive