Sen. Ted Cruz (R-Texas) has taken on a seemingly strong pro-worker stance with the introduction of his “No Tax on Tips” Act on June 20. The bill aims to make tips tax exempt, meaning any cash, check, or credit and debit card charges that are filed as tipped wages are 100% tax deductible.
At face value, this is a fantastic bill that aims to keep more money in the pockets of the working class. Everyone knows how heavily service workers rely on tips to get by, and here comes Cruz taking matters into his own hands to ensure that these workers get to keep their hard earned money. This bill is a great way for him to garner bipartisan support for his campaign. It shows that he is a competent and capable senator that is devoted to doing what is best for the people… right?
Tipped employees make up a whopping 2.5% of all occupations, and a staggering 37% do not make enough to have to pay federal income taxes. What tipped employees need is not a tax cut; they need to make more money. Federally, when an employee makes more than $30 a month in tips, they meet the definition of a tipped employee and their minimum wage drops from $7.25 an hour to $2.13.
The $30 parameter can be adjusted by each state. Vermont, Pennsylvania and Maine have theirs set to $120, $135 and $175 respectively. Texas has theirs set to $20. Thanks, Cruz. Way to look out for your fellow Texans.
If Cruz was sincere about being pro-worker, then he would at least raise tipped employee minimum wage to match that of non-tipped employees. If he was genuine about wanting to “help families deal with the historic inflation caused by the Biden administration,” then he would advocate for raising the federal minimum wage so that it did not amount to $15,080 annually, a mere $20 above the poverty line of $15,060.
The main argument against raising the minimum wage is that it will be harmful to small businesses as some may not make enough to afford to pay their employees $10 or $15 an hour. However, states like Montana, Ohio and Minnesota make exceptions to minimum wage requirements for businesses who earn less than $110,000, $385,000 and $500,000 in annual gross sales, receipts and revenue respectively.
Cruz wants people to think that the bare minimum pro-worker legislation he puts forward is the best thing this country can afford to do. He gets cheap talking points for debates and campaign ads, he secures easy votes in his next election and he gets thousands of dollars in donations from industry groups like the Texas Restaurant Association who rejoice in the fact that restaurants can continue to get away with paying their employees meager wages. Marketing is what makes millionaires out of snake oil salesmen. Do not fall for their false promises and do not settle for half-baked solutions. Vote, petition and protest until lawmakers carry out the will of the people.
Write to Cruz or schedule a meeting with him at cruz.senate.gov/contact.
