North Michigan News

Senator John Damoose has introduced legislation in Michigan to exempt tips earned by hospitality workers from state income taxes. The proposed bill aims to provide financial relief for those working in the tourism and hospitality sectors, which are vital to the economies of Northern Michigan and the Upper Peninsula.

“Tourism and hospitality are both incredibly important to the Northern Michigan and Upper Peninsula economies,” stated Damoose, a Republican from Harbor Springs. He emphasized the rising costs faced by workers and his intent to alleviate these concerns through this legislative measure.

The proposal mirrors federal efforts by offering a 100% exemption on income derived from tips. “A tip is earned by an employee going above and beyond and can fluctuate greatly based on an immeasurable number of factors,” Damoose explained. He further noted that government taxation already takes a significant portion of earnings, suggesting this as one method of providing financial relief.

Damoose also expressed hope that this initiative might pave the way for broader tax relief measures for Michigan workers. He pointed out that this legislation could act as a safeguard if no agreement is reached on preserving Michigan’s tipped wage provisions before February 21.

“As we work through the issue, continue hearings and work to get tip credit legislation to the governor’s desk, I wanted to introduce this measure as a way to safeguard hospitality workers’ tipped earnings, which are expected to drop should the new law take effect without a deal,” he remarked. He added that removing the tax burden on tipped earnings would increase wages for these workers without increasing costs for businesses.