What would be the result

[Cherico]

What would happen if your goverment (what ever country you live
in) declared that Overtime and Tips were non taxable income?

[Grey Wolf]

Surely you don't get taxed on tips ?

Grey Wolf

[Agrippa]

In the US tips are taxable and considered ordinary income - waiters usually only receive a salary of about $2/hr and depend on tips for the rest. Of course, since most tips come in the form of cash, the govt doesn't really have a way to track how much you get. So, what most waiters do is add enough tips so that with their salary they get up to the minimum wage, then the rest of the tips 'disappear' from public record.

Assuming overtime is not considered taxable, then we suddenly see a 5 hr work week suddenly coming about for hourly employees and people work an additional 7 or 8 hrs of overtime a day. Salaried employees get screwed, are pissed off, start lobbying to Congress, and the loophole is closed next year.

Unless hourly employees form a lobbying group and start making donations to Congress. And that's the moral of the story kids, when you start making extra money, immediately start paying off your local protection racket, err, whoops, government as they prefer to be called, lest they start making press releases about you, an evil person who is not contributing his due to society and must face a sharp increase in taxes.

[Fellatio Nelson]

You get taxed on overtime - if you do a job where you get overtime, obviously - but I think you'd have to be extremely honest or extremely lucky with tips to bother the UK tax people about them.

I suppose it's cos we have a minimum wage and tipping isn't really expected.