Gaetz, Massie Introduce Bill Removing Income Tax from Tips

Gaetz, Massie Introduce Bill Removing Income Tax from Tips

Grayson Bakich
Grayson Bakich
June 19, 2024

As service industry workers know, tips and gratuities can significantly impact their livelihood. Former President Donald Trump's proposal to remove federal income taxes from tips, potentially boosting their earnings, has become a popular slogan. In a proactive response, Representatives Matt Gaetz (R-FL) and Thomas Massie (R-KY) are introducing the Tax-Free Tips Act.

The bill exempts tips from taxable income by reclassifying them as property transferred as gifts. It would begin to apply to tips received in the months following the Act's adoption into law.

Earlier in June as reported by Breitbart, Trump spoke to supporters in Las Vegas, Nevada, where he first announced the idea, saying, "So, this is the first time I've said this. And, for those hotel workers and people that get tips, you're going to be very happy. Because when I get to office, we are going to not charge taxes on tips — people making tips."

The proposal quickly caught on in the form of the slogan "no taxes on tips," which supporters have taken to writing on restaurant bills. This was evidently started by Representative Marjorie Taylor Greene (R-GA).

In his press release, Rep. Gaetz said, "As the cost of living continues to rise, the hardworking men and women in the service industry, many of whom may be working a second job to make ends meet, must be allowed to keep every dollar of tip money they earn. I am proud to join with Rep. Thomas Massie in co-leading this important tax-relief legislation."

"Ron Paul had it right and so does Donald Trump. Taxing tips is regressive and goes against American tradition. But now, digital payments allow the government to tax every transaction, even those that historically have not been taxed. With inflation raging, it only makes sense to eliminate the tax on tips and provide relief to working folks," Rep. Massie added.

The Tax-Free Tips Act, despite its origins, aligns with recent comments by other Republican lawmakers to The Floridian, dispelling claims that their Party was in favor of raising taxes.

Representative Byron Donalds (R-FL) called raising taxes in this economy "stupid" and said, "Common sense does not live on Capitol Hill."

Senator Ted Cruz (R-TX) added, "Every Republican in the Senate was unified in passing those tax cuts. The economy took off, producing the lowest unemployment in 50 years. Given the incredible results they produced, I would be very surprised if we had Republicans not favor extending those tax cuts. I don't think anyone would support that."

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Grayson Bakich

Grayson Bakich

Florida born and raised, Grayson Bakich is a recent recipient of a Master’s Degree in Political Science at the University of Central Florida. His thesis examined recent trends in political polarization and how this leads into justification of violence.

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