Allison Schrager, Columnist

Trump Is Totally Wrong About Tipping

Instead of promising to make income from gratuities tax-free, the former president should vow to abolish tips altogether.

June 20, 2024 at 12:30 PM UTC

By Allison Schrager

Allison Schrager is a Bloomberg Opinion columnist covering economics. A senior fellow at the Manhattan Institute, she is author of “An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.”

Waiter?
Photographer: Joe Raedle/Getty Images North America

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Tipping is terrible. Almost no one likes it. And as it has become more ubiquitous, it has also become even more unpopular.

Undeterred by any of this, Donald Trump has an idea sure to make tip jars and in-app tip requests even more common: In a speech last week in Las Vegas, he said he would make tipped income tax-free. As a result, more pay would likely be defined as tipped income. Not only would that bring in less tax revenue at a time when it is sorely needed, it is also bad economics.