Senate Unites to Pass Ted Cruz’s “No Tax on Tips Act” — A Game-Changer for Millions of Service Workers

In a rare show of bipartisan unity, the U.S. Senate has passed the “No Tax on Tips Act” — a bill introduced by Texas Senator Ted Cruz — aimed at providing long-overdue financial relief to millions of service industry workers.

The legislation, which passed unanimously, would make tips exempt from federal income tax, directly benefiting workers like waiters, bartenders, delivery drivers, and hotel staff — the very people who rely on gratuities to survive.

👏 A Boost for the Working Class

Senator Ted Cruz hailed the bill as a major win for working Americans.

“This legislation will have a lasting impact on millions of Americans by protecting the hard-earned dollars of blue-collar workers,” Cruz said. “These are the very people who are living paycheck-to-paycheck.”

He emphasized that tipped workers often face inconsistent income and long hours, and that removing federal taxes on tips would help them keep more of what they earn.

For Cruz, this isn’t just about tax policy — it’s about fairness.

🤝 Bipartisan Support: A Rare Political Moment

Joining Cruz in co-sponsoring the legislation was Democratic Senator Jacky Rosen of Nevada

, whose state’s booming hospitality sector depends heavily on tipping.

The bipartisan nature of the bill helped it sail through the Senate without opposition — a rare event in today’s divided Congress.

“Service workers form the backbone of our tourism economy,” Rosen said. “This bill gives them the respect and support they deserve.”

For millions of workers, that support translates directly into

more money in their pockets — and a long-overdue recognition of their contributions.

📜 How the Bill Works

The No Tax on Tips Act would amend the Internal Revenue Code

to exclude tip income from federal income taxation.

Currently, tipped employees must report their tips as income, with employers withholding both payroll and income taxes. This adds layers of complexity for both workers and small businesses.

Under the proposed law:

Workers would still report their tip earnings, but
Those earnings would not be subject to federal income tax
The exemption would apply only to
tips received directly from customers, not bonuses or hourly wages

In simple terms — service workers keep 100% of their tips, free from federal taxation.

🇺🇸 Fulfilling a Trump-Era Promise

The bill also fulfills a campaign pledge made by former President Donald Trump, who often spoke about the financial burden on servers and tipped workers.

During his rallies, Trump famously promised,

“We’ll make sure you keep your tips.”

Cruz’s bill revives that vision — blending conservative tax reform ideals with populist, working-class appeal.

Political strategists suggest the move could energize voters

who feel overlooked by traditional economic policy, especially those in the service and hospitality sectors.

💬 Service Workers React

The reaction from tipped workers across the nation has been

overwhelmingly positive.

For restaurant staff, bartenders, and delivery drivers, even modest tax relief could mean hundreds or thousands of dollars more each year.

“I work double shifts, six days a week,” said
Maria Lopez, a server in Austin. “Some nights I make good tips, but after taxes and bills, there’s not much left. This would be huge for me.”

Worker advocacy groups praised the move for

acknowledging the real-world struggles of low-wage earners and for reducing unnecessary red tape.

❓ Not Without Questions

Though the Senate’s support was unanimous, experts have raised important policy questions

Would the IRS face new challenges in enforcement? Could it lead to under-reporting of income? And how might this affect Social Security contributions, which rely on payroll taxes?

Cruz addressed the concerns head-on:

“Nothing’s perfect,” he said. “But this is a step toward putting money where it belongs — in the hands of workers, not the federal government.”

Supporters argue these challenges are manageable — and worth overcoming for the sake of working-class relief.

🏛️ Next Stop: The House of Representatives

With the Senate’s green light, the bill now heads to the House of Representatives, where it’s expected to receive both scrutiny and bipartisan interest.

Some House Republicans have already voiced their support, noting the bill’s alignment with tax reform and middle-class relief priorities.

Several Democrats from tourism-heavy states — including Florida, Nevada, and New York — are also reportedly open to backing it.

If passed by the House, it will move to the President’s desk for final approval.

📈 Potential Economic Ripple Effects

Economists remain divided over the long-term implications.

Supporters argue that allowing workers to retain more income will stimulate local economies, with service workers spending more in their own communities.

Critics worry about the loss of federal tax revenue, particularly from industries with high turnover and complex reporting systems.

Still, nearly all agree: tipped workers are among America’s most overworked and underpaid, and fresh solutions are overdue.

🎉 A Win for the Service Economy

In an era of deep political division, the unanimous passage of a Ted Cruz tax bill is nothing short of remarkable.

The No Tax on Tips Act stands as a rare example of cooperation across the aisle — uniting lawmakers around a simple, powerful message: working Americans deserve a break.

For millions of waiters, bartenders, drivers, and hotel staff across the country, the meaning is clear:

Your work matters — and your tips are finally yours to keep.

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