Wisconsin GOP Plans Bill to Exempt Tips from State Income Tax

Wisconsin GOP lawmakers are advancing a bill to eliminate state income tax on tips up to $25,000 annually for individuals earning less than $150,000, aligning state law with a recent federal provision signed by President Donald Trump. The legislation, supported by Rep. Ron Tusler and Sen. André Jacque, aims to financially benefit working-class individuals such as waiters, bartenders, delivery drivers, and other tipped workers by allowing them to keep more of their earnings and potentially encouraging more accurate tip reporting. Despite opposition concerns over the estimated $33 million annual loss in state tax revenue, proponents argue that the benefit to workers and the relatively small impact on the state budget justify the change. Hospitality industry leaders also support the bill, suggesting it could help with recruitment and retention in the service sector. No Wisconsin Democrats have publicly endorsed the bill, though some express interest in equitable solutions. The bill is currently progressing through legislative committees and awaits further votes.