Tips could soon be exempt from taxation thanks to a new initiative by US Representative Byron Donalds (R-FL).
Representative Donalds’ No Tax on Tips Act would enable workers to request a tax deduction on their taxable income equal to their reported tipped wages.
Donalds’ bill is the corollary to Senator Ted Cruz’s (R-TX) own tax exemption bill antecedently proposed in the Senate.
The idea had also been floated by former President Donald Trump, who previously promised he would terminate taxes on tips if elected.
According to Donalds, tip tax exemptions place the interests of Americans before those of Washington elitists.
“Policymakers must put the needs and financial interests of hardworking Americans first,” said Donalds. “For far-too-long, Washington’s focus has been on how much of your paycheck politicians and unelected bureaucrats will take to fund their destructive agendas.”
Donalds and Cruz’s move is supported by legislators such as Senator Rick Scott (R-FL) and Representative Derrick Van Orden (R-WI).
Senator Scott explained the animus for the bill partly derived from President Joe Biden’s poor economic policies.
“Under Biden’s administration, families are struggling to make ends meet with 20% inflation and policies that make their lives harder,” claimed Scott.
Scott further claimed that, as Florida governor, he had already performed hundreds of similar tax cuts.
“During my time as Governor of Florida, we cut taxes over 100 times to help businesses thrive and families keep more of their hard earned dollars,” recalled Scott. “It’s time we do that on the federal level with our No Tax on Tips Act.”
Donalds’ bill is almost identical to Representative Matt Gaetz’s (R-FL) own tip tax exemption legislation, with the exemption that the former’s bill would also grant the tip tax exemptions to non-citizens.
