Critics, however, caution that exempting tips may introduce distortions. They argue the policy could incentivize employers to restructure compensation in ways that increase income volatility or favor certain occupations over others. When combined with permanent tax cuts and expanded deductions, opponents contend the law prioritizes short-term financial relief at the expense of long-term budget sustainability.
Even so, many workers—particularly in hospitality, tourism, and food service—are already reporting noticeable increases in their net pay. Economists will be watching closely to see whether these targeted tax changes translate into sustained economic growth, shifts in labor practices, or deeper deficits. Continue reading…
