Trump and Harris Should Focus on the Minimum Wage, Not Tips
If the presidential candidates want to reduce income anxiety for low-paid workers, they should work to raise wages.
It’s a policy choice, too.
Photographer: Stefani Reynolds/AFP
Eliminating taxes on tips is an idea with bipartisan appeal, with both Donald Trump and Kamala Harris embracing it. But that is not the same as saying it is a good idea — and if the motivation is to improve wages and reduce income anxiety for low-paid workers, there is a far better way to do it.
Advocates for the policy say it would alleviate a financial burden on service workers, who are among the lowest-paid in the country. In 2023, the median weekly wage for tipped occupations was just $538, compared to $1,000 for non-tipped workers. These lower wages explain why 37% of tipped workers, according to the Yale Budget Lab, don’t currently owe any federal income taxes at all. The higher-earning 63% would still benefit from a policy change.