The Senate on Tuesday passed a bill that would eliminate federal taxes on tips, advancing with the help of Democrats a top campaign promise of President Trump.
Sen. Jacky Rosen (D-Nev.) brought the bill to the floor with the expectation that it would be blocked, but Sen. Ted Cruz (R-Texas) declined to. It passed via unanimous consent (UC).
“I just want to say: This is great news for Nevada,” Rosen said after the bill was advanced, lauding the work of the millions of hospitality and service workers in her home state, who she says are being “squeezed by rising costs.”
“This bill is not the be-all, end-all, but it’s going to offer immediate financial relief while the Senate continues to work to lower costs and find other avenues of relief for hardworking families,” she said before yielding the floor.
Trump unveiled the idea last year during a campaign stop in Nevada, which is home to scores of tipped workers.
Cruz noted in his floor remarks in support of Rosen’s UC request that the Nevada senators Rosen and Sen. Catherine Cortez Masto (D-Nev.) relayed that roughly 25 percent of Nevada workers rely on tips. Rosen said that the Silver State has more tipped workers per capita than any other.
“Nevadans, our families, are being squeezed, and we need real relief,” Rosen said in her floor remarks. “For some, many service and hospitality workers, tips aren’t extra, it’s part of their income that they use to make ends meet.”
The Texas Republican spoke up in support of the bill immediately after, explaining the genesis of the push by Trump during the campaign and hailing it as a moment of “political genius” by the president to back the idea.
The bill, the No Tax on Tips Act, will now head to the House, where the provision is expected to be passed one way or another be it via the stand-alone measure or Trump’s “big, beautiful bill” that will extend tax cuts.
“Here’s the good news: With what we just saw now, the certainty that we will see no tax on tips become the law of the land, I think, is very close to 100 percent,” Cruz said. “One way or another, no tax on tips is going to become law.”
The legislation would establish a new tax deduction of up to $25,000 for tips, among other things.
Updated at 5:07 p.m.
