In a rare show of bipartisan unity, the U.S. Senate today unanimously passed the “No Tax on Tips Act” with a resounding 100-0 vote. The legislation, championed by Senator Ted Cruz (R-Texas) and co-led by Senator Jacky Rosen (D-Nev.), aims to exempt tips from federal income taxation, fulfilling a promise made by President Donald Trump.
The bill, now moving to the House of Representatives for consideration, seeks to provide financial relief to millions of American workers who rely on tips as a significant portion of their income.
“President Trump made a promise to the American people that he would eliminate taxes on tips,” said Cruz. “In Congress, I formed a bipartisan, bicameral coalition to get that done, and in the Senate introduced the No Tax on Tips Act. Today, I went with Senator Rosen to the floor to secure Senate passage of the bill.”
Cruz emphasized the potential impact of the legislation on working-class families: “This legislation will have a lasting impact on millions of Americans by protecting the hard-earned dollars of blue-collar workers, the very people who are living paycheck-to-paycheck. I urge my colleagues in the House to pass this important bill and send it to the President’s desk to be signed into law.”
The “No Tax on Tips Act” defines “cash tips” broadly to include cash, credit and debit card charges, and checks. It allows taxpayers to claim a 100% deduction for tipped wages when filing their federal income tax returns.
The updated text of the bill includes specific “guardrails” designed to ensure that only traditionally tipped employees will benefit from the exemption.
This legislative effort aligns with Cruz’s focus on tax cuts and job growth.
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He played a key role in the 2017 tax reform, which significantly reduced taxes for individuals and businesses, and has been a vocal advocate for making those cuts permanent.
Additionally, Cruz was instrumental in the passage of the USMCA trade agreement, which he highlights as a victory for Texas’s agricultural and manufacturing sectors. His dedication to supporting Texas businesses has earned him the U.S. Chamber of Commerce’s prestigious “Spirit of Enterprise” award.
With its unanimous Senate passage, the “No Tax on Tips Act” now faces its next test in the House. Should it pass there, it would then head to the President’s desk, potentially offering significant financial relief to a substantial segment of the American workforce.
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