Former President Donald Trump has proposed eliminating taxes on tips, igniting a heated debate over the longstanding practice of tipping in the United States. Opponents caution that repealing taxes on tips would further entrench the tip culture. This amendment would put service workers in a difficult position because they typically rely on tips to supplement their already low wages. As the conversation unfolds, individuals from different walks of life share their experiences and opinions regarding tipping and its implications in the modern economy.
Tipping has become an institution in American society, particularly in the service sector. An estimated 17 percent of workers, one in six, currently make less than the federal minimum wage, and thus gratuities are necessary for their survival. Ellen, a 33-year-old career cook, reflects on her training, stating, “I was taught that 18% was standard for restaurant tips, with a possible 5% increase for exceptional service.” This expectation puts the onus on customers to already know how to follow the status quo when eating out.
As economic paradigms continue to change, the national conversation about tipping has awakened like never before. Robert Healey, a 68-year-old retired bus driver, said he never used to tip. Instead, he’s been tipping more, because he knows that more people these days are doing more for less in today’s gig economy. “These are the people who are doing the work,” he asserts, emphasizing the dedication of service workers in an increasingly challenging job market.
Garrett Petters, a 29-year-old architect, recently found it quite liberating to eat at restaurants in Paris, which has no tipping culture. His comments reflected a huge sense of relief that he wouldn’t have to figure out how much to tip while having his meal. “We were talking about how nice it is in Europe that they pay their waiters and waitresses and we don’t have to tip because of it, and isn’t that cool?” Petters remarked. He underscored the point that tipping practices in Europe are not the same as in the U.S. In the United States, gratuities have almost turned into an expectation.
As tipping expands into new service areas, many people are feeling bombarded by these new asks for tips. For 75-year-old retired musician and lawyer Tom Schultz, it was quite the recent encounter. While grocery shopping in Denver, Colorado, a stranger suddenly asked him for a gratuity. “We’re confronted with this at every transaction,” he said. Schultz warns that this trend can prevent authentic interaction between consumers and employees. “There’s always a bit of tension involved,” he noted. “It’s always a bit unsettling. It’s uncomfortable.”
The adoption of electronic point-of-sale (POS) systems has become a primary driver in the uptick in tipping asks. Ian, a 46-year-old home care worker, said he was tired of the ubiquitous tip screens appearing at point of sale. He pointed out how these innovations have added to the stress guests are under to tip.
Ellen, too, has felt her share of frustrations with the constantly-changing tipping culture. “I feel like businesses are trying to guilt-trip me into tipping more, which I resent,” she stated. Her experience illustrates a mounting frustration among consumers who feel compelled to tip, even when it’s not for great service. Ellen’s viewpoint illustrates an unexpected yet growing conflict between businesses and customers over the presence of expected tips.
In reaction to all of this economic squeeze, people are tipping differently. Sandra, a 62-year-old white woman, has increased her tip amount from 15 percent to 20 percent. These days, in response to the local economic challenges, she’s even tipping 25% — yikes! Her willingness to tip more demonstrates an understanding of the hardships many service workers face during difficult times.
Despite these personal adjustments, data indicates a troubling trend for the industry: average full-service restaurant tips fell to 19.3% in the fourth quarter of 2024, marking a six-year low. This decline raises broader concerns about the long-term viability of tipping as a stable, predictable, dependable income stream for service employees.
The pandemic has added more complication to the already complex tipping landscape. Frontline health workers, already under-equipped, incurred double the risk during the public health crisis. In appreciation, many customers expressed their gratitude by raising their tips. As the world transitions from the shadow of the pandemic, the discussion around tipping remains dynamic.
Opponents of Trump’s plan say that getting rid of taxes on tips would deepen the already horrifying difficulties service workers face. They contend that such a move might allow employers to further reduce wages under the guise of relying on gratuities. Petters elaborated on this sentiment, stating, “I just said, ‘Why aren’t you mad at your boss for not paying you a livable wage?’ I think business owners are really taking advantage of the situation.”
As the conversation surrounding the future of tipping goes on, it’s evident that there is no consensus. Everyone’s perspective largely depends on where they stand in their own economic realities. The future of tipping in America is anyone’s guess as each stakeholder continues to feel their way through the new expectations and cultural norms.