Donald J. Trump is officially a moron. His latest concept of taxes is to not charge income taxes on overtime pay. This brings his concepts to two that benefit only a specific part of employees. The other is tips and no taxes on them. So this benefits only those hourly employees who work overtime (more than 40 hours per week) and those in the service industry who collect tips from customers. Other than the glaring question of why do these people get a tax break and my being a salary employed person I get ZERO tax breaks? Government should NEVER pass laws benefiting only a fraction of society.
So put that aside and look at the whole picture of what will happen should overtime be exempt from income taxes. When it comes to Social Security taxes, currently the rate of tax is 12.4%. If you are self-employed you pay the full 12.4% of this tax; whereby if you are employed you pay 6.2% of this tax and your employer pays the other 6.2%.
Now what employers decide to do becomes a numbers game. Should an employer save money paying you time and one-half to work 48 hours (or more) per week, then they will reduce the number of employees and increase the number of people working overtime. Jobs could be lost as a reality of this decision. Of course this is not considering the Medicare tax of 2.9% that is shared between employer and employee.
Another thing to consider is overtime pay is income, so why do I have to pay my income taxes on 100% of my income because I am salary while someone working overtime does not have to pay taxes on 100% of their income. We now have the situation of unfair taxation. How does Trump plan to handle this? He doesn’t anymore than Kamala Harris. They are spewing garbage they cannot deliver on.
Should congress try passing this law I see it being challenged before the ink is dry. It is unfair taxation and there is no other way to define it. Tip exclusion from taxes is no different than exclusion of overtime taxes.
Already wait staff at food joints are paid chump change hourly as employers in the industry count tips as part of their wages. Currently the government counts tips as part of their wages. Tips really are the majority of these workers income. The law would then allow employers to pay $2.00 (estimate) per hour and only have to pay taxes on that hourly wage rate. Employees would then be taxed on the income they make based on that $2.00 per hour wages. Based on $2.00 per hour they then have an annual salary of $4160 per year. How does anyone qualify to rent, purchase, obtain credit on a $4160 per year wages? Does this mean when it comes to government aid they can only use this income to determine eligibility? Already tipped workers have a major advantage with income taxes due to reporting of tips as income to employers. You really think that is going to fly as legal? Try applying for credit on that income of your salary.
Hasn’t it always been an issue for tipped workers to obtain credit since tips are not insured to determine your income on. One customer may leave $40, the next two nothing. Those leaving the $40 tip do so every three weeks, those not leaving a tip come every week. So one week you made $40 more than the next three. How does the lender know or have any insurance you will continue to receive the larger tips for income to use in paying back your credit?
Reality check, people today do not know how our government works. If they did people would come together on common grounds, call a convention of states and start cleaning up government. The convention of states is to be free of any political party involvement and free from government involvement. It is a tool of citizens to put out of control government back in check.
How about a convention of states that repeals the 16th amendment. This is the governments right of taxation; without it government can depend only on tariffs for income. How about adding an amendment that forces all those running for office to only accept donations from registered voters within the district they will represent. An amendment forcing term limits. All of these passed by a convention of states rein in government and there is nothing they can do about it. The Supreme Court cannot do anything about it; it is a tool of the people used to control government.
Suddenly government is faced with no income, so how do they fund all of the illegal alphabet agencies they created? Department of Education would be gone, CDC, DOJ, Homeland Security, government funding of NATO, UN, WHO would also be all gone due to no money. Control would return to the states for these things where they always should have been. Federal government can go back to what the original intent was, to defend the boundaries of the United States of America and address international affairs.
It is time American’s stop asking government to fix our problems. Time for American’s to get educated on the power of our constitution, of our government designed to be ran by the people and for the people. If you would all just understand it, then maybe we as a collective whole could actually solve governments problems that would in turn automatically fix our problems.
