Washington State Weed: Taxes and Tipping your Budtender

Washington State - should you tip your bud tender? Why or why not?

Regardless of how you feel about tipping, the practice is legal for purchasing just about everything ... including recreational marijuana.

In Washington State, Seattle is on the verge of eliminating at least some forms of tipping, due in large part to the mandatory $15 minimum wage that is slowly being phased in over the next few years. It makes sense, too - we purchase so many things in our daily lives where tipping is not a condition of the sale. A lot of people, myself included, like ONE final price.

When Washington State started the privatization of distilled spirit retail sales in June of 2012, a lot of people were very upset with the outcome. The cost of the product went up dramatically... and not only that, but the sticker shock at the end of the sale was mostly of genuine surprise. We went from state stores who included everything in one price (all taxes and fees), to having one price shown for the item, and the taxes calculated separately at check out. The current tax rate for distilled spirits in WA state is 20.5% of the retail purchase price plus $3.7708 per liter. If you purchase one liter of cheap Vodka, for instance, the price you see on the shelf will be something like $11.99... but when you check out the price would come to $18.22 ($18.21875)... a difference of $6.23 which is OVER 50 (FIFTY!) PERCENT higher than the price you see on the shelf (not to mention this same bottle might have actually been only $9.99 - all in - when the state stores were open just days earlier but that's a whole other conversation). 

Where am I heading with this? I think a lot of people really want transparency with the prices they see. It helps consumers make informed decisions. 

In 2012, the airline industry had a bit of a shake up when new regulations were passed that demanded they list the FINAL PRICE  of the item FIRST, and then provide itemized details about the taxes and fees afterwards. This change made what was once a tedious process (checking each ticket individually) into a streamlined way of easily checking prices. Consumers really won here. The airlines have and will never be done with additional fees... it is pretty obvious they cant help themselves... see all of the new baggage, food, and other fees that have been multiplying over the past few years. These fees have become a large part of the airlines revenue and are currently not included in "final price"... its added later. This makes shopping for tickets, once again, more complicated for the consumer as the fees can range from $5 to $75 or more depending on your bag, its dimensions, and weight. It does make things a little more fair for people who just want barebone service (who would otherwise be charged to check a bag, likely through higher "margins"), but it complicates the user experience. So, a final price with taxes included is great. You quickly and easily know how much you will be paying to get from one airport to the other. It also makes sense to charge for things that only some people might want to take advantage of (like food, bags, and drinks). If I don't need bags, drinks, or food I don't want to pay for those things (indirectly). These extras that people used to get free, they now pay for, and that is OK. 

What is the point I am trying to make? Well, its complicated (<- that is the point).

As of January 8, 2016, the Washington state Liquor and Cannabis Board (PDF) has allowed tipping in the legal Marijuana Industry, but that doesn't mean it is an acceptable practice in all situations. In fact, the bulletin was specific that in no way can tipping be mandatory specifically to avoid a situation where tips become a part of the sale (like you may find in restaurants - for example: groups of 6 or more must add a mandatory 18% gratuity).

So, as of now, it is up to consumers to decide if they want to leave a tip... and how much. It could be your change. It could be a dollar... it could be more... and you can decide... but should you have to? I believe the fact that there is even a tip jar there to begin with puts pressure on people to tip regardless of service... and in most cases you don't need to tip at all (unless the budtender really does go above and beyond, and if that is the case just give them money directly... not to a tip jar where the money could be pooled, go to the owners, or something else weird that I cant even think of). If you are just going to the marijuana store to pick stuff up, like you would at Target or Bartell's, why would you leave a tip? You likely wouldn't. So what is the point? 

Let me give you a real world example. In Seattle's SODO there are two stores I frequent which are very close to each other. One has a tip jar (and slightly lower prices), the other no tip jar (and slightly higher prices). Anyone know which stores I am talking about? Well, the names of the stores are not important but my experiences with them are. I try to go to the tip-free place much more often, even though it can be more expensive, simply because I participate in, but no not agree with tipping. Why do I have to give someone a few bucks for grabbing an item from behind the counter? That seems a little unfair. There is a tip jar there though, so if I don't tip I will feel like a cheap asshole and if I do I will feel like I needlessly gave away some of my hard earned money. I just can't win. Is it just me? Am I the only one who feels this awkward about a few bucks? The same store that allows tipping used to also not include sales tax in the price of the products so when you'd look at the prices they would be out of this world... until you check out... and they add 37% taxes on top. The first time I shopped there, I was so embarrassed because I was used to the store that included taxes in the final price... so I didn't have enough money for everything I wanted to purchase. It was very awkward. They now include the taxes but provide a tip jar. Some companies just cant get away from trying to make things more complicated.

To be fair, I am not a customer who needs a lot of attention and time. I have looked at the menus before arriving and I know what I want. I will ask the budtender if they have a favorite or recommendation but that's about it... so maybe I just feel like I already did all the work and then am just giving them money to hand me something. Which I don't agree with, but I do still tip out of guilt - which is more or less the whole point of tipping now.

Some of you might be like "what a whiner - its just a few bucks who cares?", but let me propose another side of the story. Is tipping the budtender really helping them? There is a few areas where it might actually be hurting them. 

First, you don't know how the tip jar is split. When I worked as a concierge we were not allowed to be tipped. It was not a hotel, where tips would normally be like the majority of the pay, but a high end retail place. We would first politely decline, but if someone was pushy, we would graciously accept the tip and it would be pooled for EVERYONE at the end of the year to throw a party. Where everyone was invited - management, some customers, and others. So when I would get tips, they wouldn't go to me - only a portion would - and only the portion management decided as they were in charge of the party and all the planning. So when a customer would give me $5 or $10 for pointing out where the valet was, I wouldn't really see that (but I guess it makes people feel really good so there is that). 

Second, when management sees how much money is being tipped, they have an incentive to pay people less per hour ("they will make it up and then some in tips!"). This might not affect the first set of people who are hired, but as in all of retail there is high turnover, so the subsequent rounds of those hired might be paid less and less with the hope that they will be so happy with all of these tips it will not matter. Who is winning here? Is the customer winning? No. Is the employee winning? Perhaps, but they'd likely be better off with a higher stable wage. The real winner is the store owners and managers who can pay people less and expect consumers to feel guilty enough to make up the difference.

If you were a budtender looking for work what would be more appealing to you? $10 and hour and the potential to earn $5 in tips for that hour, or $15 an hour? Because tips are not mandatory for Marijuana in Washington State, some customers will tip and others will not. The difference is the person who makes $15 is more or less "guaranteed" $600 for a 40 hour week, where the person who has the potential for tips might make $400 guaranteed and maybe, if most of the people tip this person, will get the remainder in cash. There is the potential to make even more money with tips but with assholes like me out there, the consistency could be an issue. This is an extreme over-simplification but hopefully you understand that it would be in the budtenders best financial interest to make more guaranteed money per hour with no tips. Employers should pay their workers a good and consistent wage... why complicate things with schemes?

If you tip your budtender, you should also consider tipping everyone else in your life as well. UPS guy, Target cashier, Gas Station manager... the person who holds the "slow/stop" sign during road construction... everyone should get a tip. Where do we draw the line? 

As I mentioned above, I will tip out of guilt, but that guilt also keeps me away from the very business that is trying to entice me with lower prices. That is a little counterproductive.. but maybe it is just me.