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Kamala Harris supports Trump’s plan to abolish taxes on tips
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Kamala Harris supports Trump’s plan to abolish taxes on tips

In a rare act of bipartisan unity, Vice President Kamala Harris came out in favor of eliminating the tax on tips for hospitality and service sector workers, echoing a tax proposal introduced by former President Donald Trump just months ago.

The announcement was made Saturday during a campaign rally in Las Vegas. Harris and her running mate, Minnesota Governor Tim Walz, spoke to thousands of people, including members of Nevada’s influential food service workers union.

“I promise everyone here that when I am president, we will continue our fight for America’s working families, including by raising the minimum wage and eliminating the tax on tips for service and hospitality workers,” Harris told the crowd.

The vice president’s support of this policy represents a significant moment in her campaign, as it is one of the first significant economic policy proposals she has made since ascending to the top of the Democratic ticket last month.

Speaking to reporters in Arizona, Harris said she would present her economic policy program next week, focusing on “what we need to do to reduce costs while strengthening the economy.”

Newsweek contacted Harris’ campaign team via email on Saturday to request further comment.

Kamala Harris Donald
Kamala Harris supports a plan to eliminate the tax on service workers’ tips, just months after Donald Trump made the same proposal.

Andrew Harnick and Tom Williams/ASSOCIATED PRESS

Trump first proposed the idea of ​​tax-free tips during a campaign rally in Las Vegas in June to appeal to the state’s many hospitality workers. “The hotel workers and the people who get tips are going to be very happy because when I get into office, we’re not going to tax tips,” Trump said. “We’re going to do that right at the beginning of my term.”

The proposal has received significant public support, according to a recent poll conducted by Redfield & Wilton Strategies. NewsweekThe poll, conducted on July 29 among 1,750 eligible voters in the United States, found that 67 percent of Americans believe that tips given to service workers should not be taxed, while only 19 percent believe they should be.

Support for this measure crosses party lines: 68 percent of Republicans and 65 percent of Democrats support abolishing the tax on tips.

Despite their popularity, the economic consequences of such a policy are complex. The bipartisan Committee for a Responsible Federal Budget estimates that exempting all tips from federal income and payroll taxes could reduce federal revenues by $150 billion to $250 billion over 10 years on a static basis. The committee warns that the revenue loss could be significantly higher if behavioral effects are included.

Howard Gleckman, a senior fellow at the nonpartisan Urban-Brookings Tax Policy Center, had previously expressed concerns about the proposal’s potential impact. “Tax-free tips could help a relatively small number of servers in upscale restaurants,” he noted.

The political landscape in Nevada, a key swing state, makes the issue even more complicated. In 2020, Biden narrowly beat Trump there by 2.4 percentage points. Now both Harris and Trump are vying for the support of the large coalition of service workers in the state known for its tourism.

A day before Harris’ rally, Culinary Workers Union Local 226, which represents 60,000 workers in the hotel, restaurant and entertainment industries, announced its support for Harris, according to the Associated Press. “The road to victory runs through Nevada,” the union declared, “and the Culinary Union will save Nevada for President Kamala Harris and Vice President Tim Walz.”

However, the union has reportedly previously pushed back against Trump’s pledge when he first proposed it in June. As the campaign intensifies, both Harris and Trump are expected to make frequent trips to Nevada, recognizing the state’s potential as a swing state in the upcoming election.

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