Hotels, restaurants: tips paid by credit card will soon be tax-exempt

It was a proposal carried by the Modem. On the occasion of his visit to the Sirha fair in Lyon, dedicated to hotels, restaurants and food, the President of the Republic announced this Monday morning that tips paid by bank card in the HCR (hotel- catering) will soon be tax-exempt.

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"We will pass the texts in the coming weeks," said the tenant of the Elysée, who wants tips paid by credit card to be "tax-free and without charge" for the employer as for the employee. "It's a measure that costs nothing, because today it doesn't work," he noted. The measure must be effective “as soon as possible”, in order to strengthen the purchasing power of workers in the sector. This change was applauded by the participants in the show, present around Emmanuel Macron. “Me, I believe in it a lot”, launched the President of the Republic, who recalled that the French had turned massively to dematerialized payments during the health crisis.

Traditionally, tips are paid in cash instead, with customers depositing their change before leaving the establishment. But, here too, the evolution of payment methods is felt. If many customers want to pay a tip by credit card, professionals are more mixed: if the change can disappear in a pocket, payments by credit card are declared and taxed. In addition, tips paid in cash declined during the health crisis, while dematerialized payment gained ground. A loss of earnings felt by the employees.

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The measure must therefore change this situation, by adapting the tipping system to modern payment methods. Tipping by card will become more attractive to employers, customers and employees. This change must also support hotel and restaurant workers, who suffer from harsh working conditions and low wages. These professions suffer from a lack of attractiveness and they have seen tens of thousands of employees leave the ranks during the health crisis. More than 120,000 people are missing, according to Umih and GNI, the main trade unions representing the sector. What put in difficulty many establishments.

Emmanuel Macron felt that “several levers” could be activated to combat these recruitment difficulties. First, the reform of unemployment insurance, “whose objective is to encourage people to return to work”. Then, the "training" of the unemployed and people seeking to retrain. 'Learning' was also cited, as was 'attractiveness of professions'. A point on which “we must all work together”, advanced the President of the Republic. “It is done, we can be collectively more intelligent”, he launched, recalling that these trades had to take into account the “personal constraints” of the employees, and to think about a better organization of work. "There is a future, you have to go there [...] These are meaningful jobs," he insisted.

Negotiate for the branch or in companies?

This alone would not be enough to attract the recruits needed to fill the gaps. But it is part of broader discussions on the sector: discussions aimed at improving the attractiveness of these professions are taking place between employers and unions, and the Minister of Labor, Élisabeth Borne, indicated recently that she had asked the runway representatives and a roadmap to support this sector which has borne the full brunt of the health crisis. “The branch minima in this sector are below the minimum wage. In terms of the attractiveness of the sector, I think it's a very bad signal, ”she said in particular.

If “everyone must do their part”, including employers, according to the minister, the Modem proposes, according to Les Échos, to take advantage of the debate on the 2022 budget to exempt tips in the HCR sector from tax. “It seems appropriate to us to exempt tips from tax and to leverage the generosity of the French to strengthen the attractiveness of these professions”, explained the deputy (Modem) Jean-Noël Barrot to our colleagues.

Employers, for their part, remain cautious: on LCI, this Monday, the boss of Medef castigated a "national vision of the economy from Paris", recalling that the balance sheet for the year differed for hotels and restaurants according to the territories. “It is rather in the companies that it happens”, underlined Geoffroy Roux de Bézieux, indicating that the local scale would be more relevant than that of the branch to negotiate wages.