Vice President Kamala Harris has announced her support for eliminating federal taxes on tipped wages for service workers, aligning herself with a similar proposal from former President Donald Trump.
Harris made the pledge during a rally in Las Vegas on Saturday, where she appeared alongside her running mate, Minnesota Governor Tim Walz.
Harris praised the efforts of the Culinary Workers Union, which had endorsed her the day before, and emphasized her commitment to policies that would benefit union members.
“When I am president, we will continue our fight for working families of America, including raising the minimum wage and eliminating taxes on tips for service and hospitality workers,” she declared to the enthusiastic crowd.
A Harris campaign official later clarified that implementing such a policy would require new legislation. If elected, Harris would work with Congress to craft a proposal that would include income limits and strict requirements to prevent misuse by high earners, such as hedge fund managers and lawyers, who might try to structure their compensation to benefit from the tax exemption.
Harris’ proposal would be coupled with a push to increase the federal minimum wage, according to the campaign official.
In response to Harris’ remarks, former President Trump accused her of copying his policy idea.
“Kamala Harris…just copied my NO TAXES ON TIPS Policy,” Trump wrote on his Truth Social platform, asserting that she did so “only for Political Purposes.”
Trump first introduced his proposal to eliminate taxes on tips during a June rally in Las Vegas. While several congressional Republicans have introduced related bills following Trump’s announcement, the proposal has received mixed reactions within the GOP.
Some Republicans have expressed concerns about the impact on the national debt and questioned the fairness of the policy to workers who do not receive tips.
Restaurant workers and advocates have also had varied reactions to the proposal. Some prefer an increase in base wages over the elimination of taxes on tips, as reported by NBC News.
A Yale University analysis of the “No Tax on Tips Act,” a bill led by Senator Ted Cruz (R-Texas), found that the policy would impact only about 2.5% of the workforce and 5% of workers in the bottom 25% of earners.
Asked whether Harris would support the Republican-led bills to exempt tip income, her campaign reiterated that any tax exemption on tips would require legislation and that Harris would work with Congress to develop a comprehensive proposal if elected.
In June, Lael Brainard, director of the White House National Economic Council, responded to Trump’s proposal by emphasizing President Joe Biden’s focus on broader policies aimed at raising the minimum wage and eliminating the tipped minimum wage.
Brainard noted that these measures could lead to significant increases in income for workers across the country.
