The Republican Study Committee (RSC) has unveiled the "One Big Beautiful Bill" on the social media platform X. The proposed legislation includes measures such as eliminating taxes on tips, increasing take-home pay, making the Child Tax Credit permanent, and providing savings for seniors.
According to the Economic Policy Institute (EPI), millions of American workers, particularly in the restaurant industry, earn most of their income through tips rather than a standard hourly wage. The institute notes that the federal tipped minimum wage has remained at $2.13 per hour since 1991, leading many workers to rely on variable tip amounts to meet or exceed the regular minimum wage. EPI emphasizes that any changes to the taxation or treatment of tips can directly impact these workers' financial well-being.
TechNet, an advocacy group representing technology sector executives, has urged Congress to ensure gig economy workers are included in any federal proposals exempting tipped income from taxation. TechNet highlights that gig workers, such as rideshare drivers and delivery personnel, increasingly depend on tips as a core component of their earnings. A tipped income tax exemption would address the needs of this growing workforce not covered by traditional employment protections.
A 2024 study by TransUnion found that more than one-third of gig workers in the United States rely on gig work as their primary source of income. This trend reflects the increasing importance of flexible, non-traditional employment in the national economy. TransUnion indicates that changes to tax policy affecting tips would have direct financial implications for these workers.
The RSC is recognized as the largest conservative caucus in the U.S. House of Representatives and was founded in 1973 to advance a conservative legislative agenda. It brings together like-minded members to promote policies focused on limiting government, strengthening national defense, and boosting the economy. According to its website, the committee also provides research and policy tools for its members to influence legislative priorities.
