A ‘no tax on overtime’ policy is a powerful and sensible tool for retaining a highly-skilled ‘varsity squad’ of experienced firefighters, for whom substantial overtime is a critical and routine part of providing for their families and ensuring public safety. However, this same policy is counterproductive and dangerous in lower-wage, hourly industries, like for a quality control inspector making $21 an hour, where it creates a perverse incentive to deliberately slow down work for a small bonus, undermining productivity. The immense benefit of properly compensating our most vital, high-stakes professionals like firefighters decisively outweighs the risk of this policy being exploited in sectors where it rewards inefficiency instead of essential skill.
This same principle… that a policy must be targeted and not a broad, exploitable mandate… is why I am holding firm on my position regarding taxes on tips. While I fully support eliminating the tax burden on tips for service industry workers, a blanket, undefined exemption would be a mistake. It risks becoming a massive, backdoor handout to the cryptocurrency world, creating a tax-free loophole for digital transactions that have nothing to do with rewarding service. Therefore, any ‘no tax on tips’ policy must include a specific, carefully crafted exception for the traditional service and hospitality industry, ensuring the benefit goes to waitstaff, bartenders, delivery drivers, barbers, etc. not to anonymous crypto transfers.
