Shamini 
(C): Tucker Carlson News – twitter
In a pivotal win for millions of American service workers, the U.S. Senate on Tuesday unanimously passed the ‘No Tax on Tips Act’ in a 100-0 vote. The bill, which was supported by President Donald Trump and introduced by Senator Ted Cruz (R-Texas), provides a significant tax reduction incentive for workers in industries that rely on tips, by allowing them to report that 100% of their tips are not subject to federal income tax through 2028.
The law covers both employees and independent contractors in roles where tipping is common such as restaurant servers, bartenders, workers in the hospitality industry, and delivery drivers. The bill includes tips given in cash, credit, debit or check formats. The benefit is limited to those with 2025 incomes below $160,000, ensuring high earners are left out.
Expanding Relief for Employers
The legislation also benefits employers as businesses will receive a payroll tax credit for tips given in the beauty and personal care industries such as salons, spas, nail studios also expanding an existing credit available to food and beverage businesses. The authority to finalize the list of qualifying occupations lies with the Secretary of the Treasury.
Senator Cruz reiterated the significance of the bill:
“This legislation will have a lasting impact on millions of Americans by protecting the hard-earned dollars of blue-collar workers.”
Democrats also supported the bill, including Senate Minority Leader Chuck Schumer, because it was described as a win for the middle class.
“Working Americans… deserve tax relief, not the ultra-rich,” said Schumer.
The bill now heads to the House for final approval, having secured bipartisan support. If it clears the House, it will be headed to Trump, who will sign it into law fulfilling a major campaign promise and providing real tax relief to the working class.
