LAS VEGAS — A swing-state Democrat has taken up Donald Trump’s “No Tax on Tips” idea, with Rep. Steven Horsford introducing legislation that would give federal income relief to tipped workers earning less than $112,500 yearly.
The Tipped Income Protection and Support Act or TIPS Act grants a tax break to qualifying cosmetology, hospitality and food-and-beverage-service workers, parking attendants and custodial-service employees.
Asked if the provisions will apply to Nevada’s casino dealers — or to prostitutes in the Silver State’s legal brothels — a Horsford spokesman told The Post, “Hospitality is a very broad category that would include many workers in Nevada.”
Horsford said his bill would also eliminate the “subminimum wage” for tipped workers, forcing employers to pay both the federal minimum wage and pass along tips. Nevada is one of seven states where tipped workers get the state’s minimum wage — which jumped to $12 per hour in July — along with tips.
The lawmaker, who chairs the influential Congressional Black Caucus, said in a Tuesday news conference that his measure would benefit the economically disadvantaged.
“A disproportionate number of the 6 million tipped workers, who are women and people of color, make as little as $2.13 an hour, which really is poverty wages at a time when families and workers are trying to afford the cost of living,” Horsford said. “I have been leading the charge to close the racial wealth gap, and we can no longer tolerate the inequalities in the tipped work wage.”
Not everyone agrees with the Democrat’s argument. Rep. Kevin Kiley (R-Calif.) chaired a House Education and the Workforce subcommittee hearing on tipped wages Wednesday, where he defended the status quo.
“The current system gives tipped workers the opportunity to thrive, and it doesn’t just help them, it helps the restaurants and small businesses that employ them,” Kiley said.
Kiley also referred to a National Restaurant Association study that found the median wage for a tipped worker is $27 an hour, which the pol points out is far more than the federal minimum wage.
Meanwhile, more than 100 Michigan food servers and bartenders rallied at the state capitol Wednesday to halt the Wolverine State’s pending tipped-wage change, which would eliminate the lower minimum wage. Local reports quoted workers saying that state’s proposed minimum-wage hike for tipped employees could raise restaurant prices and actually cut their earnings.
Saru Jayaraman, a labor advocate who heads One Fair Wage, a group advocating for the elimination of a lower tipped minimum wage, told the House hearing the seven states that require a full minimum wage for tipped workers show tipping “the same or higher as it is in the 43 states with the subminimum wage for tipped workers.”
The advocate, who also directs the Food Labor Research Center at the University of California, Berkeley, earlier endorsed the Horsford bill, which also earned the backing of the Culinary Workers Local 226, the Las Vegas union representing thousands of tipped workers.
Horsford, in a November re-election battle against former North Las Vegas Mayor John Lee for the 4th Congressional District seat, previously co-sponsored a GOP tax-free-tips bill launched after Trump’s June 9 Las Vegas declaration that his next administration would not tax tipped income.
“These workers shouldn’t be taxed twice, once through payroll and then again on their tips,” said the incumbent, seeking a fifth House term.
Under the Horsford bill’s terms, workers would get a deduction “equal to the amount of qualified tips received” during a tax year. “Qualified tips” are those received from an unrelated party who does not have an ownership stake in the employing business and that come during the worker’s regular employment where tipping is customary.
A reading of the bill’s language suggests tips would continue to be subject to FICA taxes, which fund Social Security and Medicare.
In a previous interview with The Post, Horsford’s GOP challenger Lee — a former Democrat — lauded a proposed “No Tax on Tips” break as “great,” but said the credit doesn’t belong to Horsford.
“This was never his idea,” he said.
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