Senator Ruben Gallego (D-AZ) is introducing legislation expanding upon the "no tax on tips" provision found in the One Big Beautiful Bill (OBBB).
Specifically, Sen. Gallego's "No Tax on Large Party Tips Act" ensures that auto-gratuities and recommended tips, like the kind restaurants put on the bill for large parties, are untaxed.
"The Republicans' tax bill offers little relief to working Americans, and what relief it does offer – like no tax on tips – is shamefully short-term," Sen. Gallego said in a statement, adding that "while no tax on tips expires in 2028, tax cuts for billionaires have no sunset. We must ensure that, while they last, as many workers as possible can benefit as much as possible."
The bill marks the second revision to the tax cuts found in the OBBB that Sen. Gallego has introduced in recent weeks.
Near the end of August, the Arizona Senator introduced the Lowering Electric Bills Act, which restores clean energy tax credits from the Inflation Reduction Act (IRA) that were repealed in the OBBB.
Without these credits, he claims, energy bills will increase, and nearly 1 million jobs will be lost by 2030 due to 300 factories going unconstructed or never opening.
More recently, the Gallego introduced the "You Earn It, You Keep It Act," which expands the Social Security payroll tax to covered earnings of $250,000 a year or more.
As a result, the intended "no tax on Social Security" promise by the Trump Administration, which in practice is actually an enhanced deduction for taxpayers aged 65 and older, is fully realized.
"Like a lot of Americans, I've been paying into Social Security since my first job at fourteen. But despite decades of paying into the system, seniors are still forced to pay taxes on their hard-earned benefits – all while the ultra-wealthy barely pay into the system at all," Gallego expressed. "Trump claimed he ended taxes on Social Security. My bill actually does it. Permanently."
