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Jimmy Williams
Vice President Kamala Harris announced her intention to eliminate taxes on tipped wages for service workers, aligning her policy with a similar proposal from former President Donald Trump. Harris made this commitment during a rally in Las Vegas on Saturday, where she was joined by her running mate, Minnesota Governor Tim Walz.
Addressing a crowd that included members of the Culinary Workers Union, which had endorsed her the day before, Harris emphasized her support for working families. “When I am president, we will continue our fight for working families of America, including to raise the minimum wage, and eliminate taxes on tips for service and hospitality workers,” Harris declared.
A Harris campaign official later clarified that implementing such a policy would require legislative action. If elected, Harris plans to collaborate with Congress to craft a proposal that includes income limits and strict requirements to prevent misuse by high-income earners. The official also noted that Harris would push this proposal in conjunction with efforts to raise the minimum wage.
In response to Harris’ announcement, former President Trump accused her of copying his idea. Trump took to his social media platform, Truth Social, writing, “Kamala Harris, whose ‘Honeymoon’ period is ENDING, and is starting to get hammered in the Polls, just copied my NO TAXES ON TIPS Policy.” He further asserted, “This was a TRUMP idea. She can only steal from me.”
Trump originally proposed eliminating taxes on tips at a rally in Las Vegas in June. His campaign spokesperson, Karoline Leavitt, had previously confirmed that Trump would work with Congress to eliminate these taxes but provided few specifics at the time.
Following Trump’s announcement, several congressional Republicans introduced bills to exempt tip income from taxes. However, the proposal has received mixed reactions from within the GOP, with some members expressing concern about the impact on the national debt and the fairness of the policy to non-tipped workers.
Labor advocates and some restaurant workers have also expressed skepticism, indicating a preference for increased base wages rather than tax exemptions on tips. A Yale University analysis of a similar bill led by Senator Ted Cruz, R-Texas, found that the proposed change would only impact about 2.5% of the workforce, affecting approximately 5% of workers in the lowest income quartile.
When asked whether Harris would support existing Republican-led bills to exempt tip income, her campaign reiterated that her proposal would require new legislation. Harris, if elected, intends to work closely with Congress to ensure that the policy is crafted to benefit those who need it most.
The debate over this policy also intersected with the broader economic agenda of the Biden administration. In June, Lael Brainard, Director of the White House National Economic Council, highlighted President Biden’s commitment to raising the minimum wage and eliminating the tipped minimum wage as more comprehensive solutions for improving workers’ living standards.
“Our view is that the meaningful set of policy changes that would really lift the living standards of Nevada workers and workers all around the country would be to raise the minimum wage and eliminate the tipped minimum wage,” Brainard said. She added that such measures could lead to an additional $6,000 in income per year for affected workers.
