U.S. Senator Ant Thornton of New Mexico has expressed concerns regarding the Big Beautiful Bill, stating that it does not reduce the federal deficit but includes provisions beneficial to working-class New Mexicans. Among these are the removal of taxes on tips, overtime, and Social Security. Thornton made this statement on X.
"Let's be clear… the Big Beautiful Bill (HR 1) going through Congress doesn't reduce our federal deficit," said Thornton. "It is not fiscally conservative. There are benefits to the average working class New Mexican citizen such as: No tax on tips… No tax on social security recipients… No tax on overtime pay. Liberal / Progressive politicians hate the bill because it attempts to give money back to YOU the citizenry and NOT to the government bureaucracy."
The Internal Revenue Service (IRS) highlights that tip income has been a contentious issue, particularly for service sector workers who depend significantly on tips as part of their earnings. Tips, regardless of how they are received—whether in cash, through credit card payments, or pooled arrangements—are taxable and must be reported by employees. IRS regulations stipulate that any worker receiving $20 or more in tips within a month must report this amount to their employer by the 10th day of the following month. These amounts are subject to income tax, Social Security, and Medicare.
According to the U.S. Bureau of Labor Statistics, many service industry employees earn a substantial portion of their wages from tipping. As of May 2023, median hourly earnings for waitstaff, including tips, were $14.00. In some states, the base wage for tipped positions is only $2.13 per hour, with tips expected to make up the difference to meet minimum wage standards. Consequently, policy changes regarding tips can have significant impacts.
A survey by the Pew Research Center in 2021 revealed that 16% of Americans had earned income through online gig platforms. Of these workers, 58% said that their earnings were essential or very important for covering everyday expenses. This data underscores how alterations in tax rules can directly influence the financial stability of gig economy workers.
Thornton holds a Ph.D. in physics and was elected as U.S. Senator for New Mexico in 2024. Prior to his Senate tenure, he worked as a technology executive and advocated for conservative policies focusing on fiscal responsibility, workforce training, and regulatory reform.