The National Restaurant Association is showing its support for a GOP-backed U.S. Senate bill that would result in savings for many tipped workers.

Senator Ted Cruz (R-TX) this week introduced the No Tax on Tips Act of 2025. The bill will eliminate income tax on the tips earned by servers and bartenders in the restaurant and foodservice industry.

“Eliminating taxes on tips would put cash back in the pocket of a significant number of workers in the restaurant and foodservice industry and could help restaurant operators recruit industry workforce,” Sean Kennedy, the Association’s executive vice president of public affairs, said in a statement. “The No Tax on Tips Act of 2025 is sensible legislation that includes refinements and protections to make it fiscally responsible while still supporting our employees.”

President-Elect Donald Trump supported eliminating taxes on tips while campaigning for the office.

Cruz and Senator Rick Scott (R-FL) introduced the bill in 2023 and revised it for the 119th Congress. The new version has “guardrails” and would only benefit “traditionally tipped employees.” If it passes, those employees would be able to claim a 100% deduction for tipped wages with a limit of $25,000.

“Tax policy plays a major role in the success of the restaurant industry, so we’ll continue to work with Congress on this and other common-sense tax policy that will stimulate investments and improvements in restaurants of all sizes and help operators make greater investments in their workforce and communities,” Kennedy said.

More than 2 million tipped servers and bartenders work in the restaurant and foodservice industry.

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