“Tax-free tips up to 300 euros/month – Why is it a fair and balanced policy that protects workers and their incomes?”, is the issue raised by the Minister of State Akis Skertsos through his post.

It is recalled that yesterday, in the four changes for the modernization of the tax legislation announced by the Minister of Finance Kostis Hatzidakis, a tax-free allowance of up to 300 euros is established for tips paid via POS

In applied politics, he notes, “where the weightings to be made for each decision are many and not always distinct, very rarely does one have to choose between a clearly positive and a clearly negative option. There is rarely, that is, a “white-black” or “good-bad” dichotomy. And more often than not, it helps to ask yourself again and again why a decision that seems positive for one group might create reflexive problems for another.”

In this regard, he recalls that “the question of the taxation of tips has been valid for 30 years, but it remained inapplicable until relatively recently because contractual cash payments prevailed. The issue rightly entered the public debate with intensity, due to the rapid digitization of monetary transactions.

The reasons why a complete abolition of tip taxation would not be a fair and responsible policy are twofold:

– The first reason has to do with the justice. And when we say justice, we mean tax justice towards other categories of low-wage workers who, however, do not usually receive tips but are taxed from the first euro. An unlimited tax exemption on food service workers would create a new tax inequality and a web of incentives and disincentives with unspecified consequences for a wide range of low-wage workers.

– The second reason concerns the protection of the catering workers themselves. A full tax exemption on tips could encourage some catering employers to abusively force their workers into illegal undeclared work. To insure them, for example, for part-time work while forcing them to work full-time, covering part of their salary with tax-free tips. And insecure work means exploitation of workers in the present and a lower pension in the future.”

Given these, “justice and the protection of workers and their incomes from abusive practices are therefore the principles that lead to this balanced and fair solution of establishing a reasonable tax-free up to 300 euros/month per worker.

Thus, in this way, a customary right is preserved and legitimized that comes from the past and must be protected in a rapidly evolving digital environment that requires for many reasons to make the transition to digital payments. In a way, our policy combines tradition with evolution and the protection of the incomes of the most vulnerable workers with justice”, underlines Akis Skertsos, making a special mention at the end to his fellow ministers, Kostis Hatzidakis, Thanos Petralia and Christos Dimas.