'Trump slump' hits Las Vegas hard as tip tax break falls flat

Donald Trump's signature "No Tax on Tips" policy is failing to deliver for the very workers it was meant to help. With foreign tourists driven away by the president's inflammatory remarks and sweeping tariffs, service workers in Las Vegas say there are simply no tips left to exempt.

AFP reported Friday (local time) that Las Vegas service industry workers are suffering serious income losses and that their political loyalties are shifting ahead of November's midterm elections.

Aaron Mahan, 53, a waiter who has worked in Las Vegas for more than 30 years and once supported Trump, says he is now struggling to make ends meet. "My monthly income has dropped by $2,000 to $3,000 compared to before — it's hard to get by," he said, adding that 75 percent of his tip income had "evaporated."

Visitor numbers to Las Vegas, the gambling and tourism hub, plunged 7.5 percent last year compared to the previous year — the steepest decline since records began in 1970, excluding the COVID-19 pandemic.

Experts point to rhetoric and tariffs as the twin causes of the so-called Trump slump. Trump's harsh words toward allied nations, combined with sweeping tariffs on Canada, have fueled a growing boycott of US travel among Canadians — one of Las Vegas's core tourist demographics. Prolonged inflation driven by geopolitical tensions has also dampened demand from domestic visitors.

As tourist numbers fell, casino restaurants abandoned round-the-clock operations and laid off large numbers of staff. Ted Pappageorge, secretary-treasurer of the Culinary Union in Nevada, said Trump's unpredictable conduct had inflicted real economic damage. "What good is a tax deduction when there are no tips to collect in the first place?" he said.

The no-tax-on-tips pledge was a centerpiece of Trump's 2024 presidential campaign and is widely credited with helping him carry Nevada, then a battleground state. The policy exempts tips of up to $25,000 from federal income tax through 2028, and about 7.5 million people benefited this year, receiving an average of $7,000 each.

But service workers say they feel none of it. Trump boasted at a Nevada campaign rally this month that the country was enjoying "the greatest economy in American history," yet bartender John Felipe, 31, pushed back. "Since the inflammatory remarks and the tariffs, a third of my regular Canadian customers have stopped coming," he said. "I feel zero benefit from the tip tax exemption."

Voters who backed Trump twice are also showing signs of turning away. Mahan hinted he may vote for the Democratic Party in the November midterms and added:

"I'm still a Republican. Just not a Trump Republican."