LAS VEGAS, Nevada (FOX5) — Following a major campaign promise from both former President Donald Trump and Vice President Kamala Harris, it’s an issue that’s on many people’s minds in the Las Vegas Valley.

Both say that if elected, they will abolish the tax on tips.

When it comes to the tipping economy, Southern Nevada is home to one of the largest populations of tipped workers.

FOX5 spoke with those who would be directly affected and heard from a local tax expert about the overall economic impact of passing this law.

Las Vegas cocktail waitress Alexis White says not paying taxes on her tips would be life-changing, which she says is important because she says several former colleagues left Las Vegas because they couldn’t make ends meet in the service industry after the pandemic.

“There are countless people who have quit their jobs and moved elsewhere,” White said.

White is a member of the Culinary Union, a union and its affiliates that represent 60,000 workers in Las Vegas and Reno, including most of the casino resorts on the Strip and in Downtown Las Vegas.

According to White, most Culinary Union workers support the current push to make tips tax-free because they are not guaranteed payment of tips.

“The biggest problem with the system is that I’m not guaranteed to make a certain amount,” White said. “But I’m guaranteed to pay taxes on that amount. How does that work?”

John Wightman, a lifelong Las Vegas resident, certified public accountant and managing partner at Rich Wightman & Company, thinks this is a positive thing, adding, “It’s a targeted tax cut that will have nationwide benefits for the people who work at Denny’s, as well as the people who work at the MGM or the Venetian or any of our larger properties.”

However, Wightman addressed the obvious, namely that no tax on tips would result in lost revenue.

“The impact will obviously be less money coming into the tax system, which will require cuts and the creation of some programs and things like that,” Wightman said. “That just requires careful oversight by our governors and senators.”

In what is shaping up to be a contentious election year, the idea of ​​not taxing tips appears to have bipartisan appeal.

Democratic U.S. Senator Jacky Rosen supports the idea, and Republican Governor Joe Lombardo also supports the idea. He issued the following statement to FOX5 on Friday: “Nevadans in the service sector work hard to provide exemplary service to their customers and a high quality of life for their families – and they have a right to keep every tip they earn.”

Economists tell FOX Business that eliminating a source of income tax will be a major blow to Social Security.

Critics also fear that there could be tax shortfalls if a source of income tax revenue is eliminated, as the federal deficit would be over one trillion dollars and the national debt would be over 35 trillion dollars.

IRS figures show that American workers paid $38 billion in taxes on tips in 2018.

The median wage for waiters in the United States is about $32,000 a year, or $15.36 an hour, according to figures from the U.S. Bureau of Labor Statistics.

Critics say there should be a flat tax where everyone pays the same amount. But White says that an equal amount for everyone doesn’t make financial sense.

“Of course we want to pay taxes, of course. But we want to pay fair taxes, and that’s not happening,” White said. “We need the help of our politicians to get it right.”

Just this week, the White House press secretary said that President Biden would “absolutely” sign a bill to repeal the tip tax if it landed on his desk.

As for the elimination of the tip tax, Trump accuses Harris of stealing his idea after both candidates introduced it at separate rallies in Las Vegas months apart.

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