After more than 30 years in the Las Vegas restaurant industry, waiter Aaron Mahan ought to be pleased about Donald Trump's much-touted 'No Tax On Tips' policy. Unfortunately for this one-time supporter of the US president, the small gain he eked out on his tax return has been dwarfed by the drop in income as tourist numbers plunge. 'I'm currently making probably $2-3,000 less (per month) than I was before,' the 53-year-old told AFP. 'It's been harder for me to make ends meet with a much lower salary.'
Las Vegas, a byword for gambling and excess, last year saw a 7.5-percent fall in the number of visitors -- the largest drop outside of the Covid pandemic since the Las Vegas Convention and Visitors Authority began keeping records in 1970. Observers say Trump's frequent outbursts against allies have deterred foreign tourists, especially Canadians, who are boycotting the United States over the massive tariffs he has imposed on America's northern neighbor.
Add to that the cutbacks that many American households are making as they grapple with stubborn inflation -- caused in part by rising oil prices as a result of the US-Israeli war on Iran -- and Sin City feels altogether a lot less busy. Mahan considers himself a victim of what he calls the 'Trump slump.' The restaurant at his casino, which used to operate around the clock, has laid off about 20 employees and switched to a buffet format that is open only in the morning.
Instead of serving customers at their tables, he now stands behind a counter. This lack of interaction means less chance for customers to show their gratitude in a country where tipping is widespread on everything from food delivery to haircuts. 'I've lost about 75 per cent of my tips, which is a significant amount of my income,' he said. The Culinary Union, which represents 60,000 hospitality workers in Nevada, says thousands of its members are now out of work or seeing their hours cut.
Ted Pappageorge, the organization's secretary-treasurer, says Trump's headline-grabbing pledge ahead of the presidential election has been effectively nullified by the reality of economics that his unpredictability has created. 'If you're not making the tips, what good is the tax credit?' he fumed. Tips make up a significant portion of the income for millions of servers, housekeepers, taxi drivers, and hairstylists across the United States.
Trump's 2024 election pledge of 'No Tax on Tips,' which he said was inspired by the struggles of a Las Vegas waitress, allows for the deduction of up to $25,000 in tips from federal taxable income through the end of 2028. More than 7.5 million Americans took advantage of this provision this year, claiming an average deduction of $7,000, according to the US Treasury. Poll-watchers say the pledge helped Trump win the swing state of Nevada -- something they are hoping to do again in this November's midterm elections where the Republican Party's majority in both houses of Congress is at stake.
In a rally in the state this month, Trump insisted his policies were working. 'We had the greatest economy in the history of our country in my first term,' he told cheering supporters. 'But this is blowing it away.' The majority of Americans disagree with that rosy view, with only 30 percent of voters approving of Trump's handling of the economy. On Fremont Street, where the first casinos appeared in Las Vegas before the famous Strip was built, bartenders and other service workers lament the slump in foot traffic and the persistent inflation that is eroding their purchasing power.
'I'm not doing as much as I used to,' says John Felipe, 31, as he mixes a cocktail. 'On average, a third of our people are Canadians. We lost a lot of Canadians...after the tariffs hit. I didn't really feel the effects of 'No Tax on Tips'.' Mahan, the waiter, supported Donald Trump in 2016 and 2020, but sat out the 2024 election. He is now reconsidering his vote and says he will 'probably' vote for the Democrats come November. 'I'm still a Republican,' he sighs. 'I'm just not a Trump Republican.'
