"McDonald's employees will not only get no benefits from President Donald Trump's no-tax-on-tips efforts, but the policy also exposes inequities between businesses that decide to pay workers the federal minimum wage versus those who pay employees a smaller wage supplemented by tips, according to CEO Chris Kempczinski. The fast-food boss told CNBC's "Squawk Box" on Tuesday that while he supports the no-tax-on-tips policy, it doesn't do any favors for McDonald's restaurant workers."
"Trump included no tax on tips as part of the " Big Beautiful Bill" he signed into law in July. The legislation allows for an up to $25,000 federal income tax deduction from reported tips. Fast-food and counter workers-as well as bartender helpers, chefs and cooks, dishwashers, and other food workers-are eligible for the tax deduction, according to a White House social-media post on Tuesday."
The no-tax-on-tips policy creates a tax deduction of up to $25,000 for reported tips, targeting tipped food-service positions and similar roles. The policy advantages businesses that pay lower base wages supplemented by tips while providing no benefit to employers and workers in non-tipped operations such as McDonald's. McDonald's CEO Chris Kempczinski noted that the company does not collect tips, so its employees do not receive the tax relief. Analysis shows many tipped workers already have incomes below the federal tax threshold, limiting the deduction's practical impact for a sizable share of tipped employees.
Read at Fortune
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