Vice President Harris supports the elimination of taxes on tips for service and hospitality workers. In her address to supporters in Las Vegas over the weekend, Democratic presidential nominee Vice President Kamala Harris promised “to raise the minimum wage and eliminate taxes on tips for service and hospitality workers.” Former President and Republican presidential nominee Donald Trump called for the elimination of taxes on tips in June. Republicans in the House and Senate have since introduced legislation to make that happen, and Democrats in the Nevada congressional delegation have also come out in support of the measure..
Five questions remain about Harris’s tax agenda. Harris told reporters Saturday she plans to roll out her economic policy platform this week, which, her campaign noted Friday, would be based on President Biden’s budget priorities. TPC’s Nikhita Airi shares five tax policy questions that Harris’s platform may soon address, including potential tax increases, extension of the 2017 Tax Cuts and Jobs Act, policies for low-income tax filers and families, tariffs, and the IRS budget.
Minnesota Gov. Tim Walz’s tax policy record could also inform the debate on the campaign trail. TPC’s Richard Auxier reviews the record of Harris’s running mate, Democratic Gov. Tim Walz. Five of Walz’s Minnesota policies could feature prominently in the campaign: the expanded child tax credit, the exemption of Social Security income from state income tax for many filers, tax increases on corporations and high-income households, a payroll tax for paid leave, and cannabis taxes.
Speaking of budget and tax policy, can the government reduce its debt again? TPC’s Bill Gale and Tayae Rogers chart the history of the government’s efforts to reduce debt. “The good news is that the US has successfully reduced debt several times in the past,” they write. “The bad news is that previous fixes were too small to solve the current problem. Fixing the debt problem now requires far more substantial and sustainable policy changes than ever attempted.”
Could a bigger tax credit boost employer-provided child care? TPC’s Renu Zaretsky examines a provisionof the Child Care Affordability and Availability Act, introduced by Sens. Tim Kaine (D-VA) and Katie Britt (R-AL) last month. The provision would expand the Employer-Provided Child Care Credit. The idea looks like a win-win by supporting an increase in the supply of child care, reducing costs, and allowing more parents to remain in the workforce. But increasing the supply of child care might need solutions beyond the tax code.
Connecticut will join IRS Direct File. Treasury Secretary Janet Yellen and Democratic Gov. Ned Lamont announced Friday that Connecticut will join IRS Direct File for federal tax returns in the 2025 filing season. The IRS piloted the Direct File program in 12 states during the 2024 filing season. The agency plans to make Direct File available in all 50 states in 2025. Congressional Republicans want to block its broader implementation.
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