No Tax on Tips: New York Governor Hochul's Bold Move for Tipped Workers

Thursday, 1 January 2026, 17:09

No tax on tips is the focus of Governor Kathy Hochul's upcoming proposal aimed at supporting New York’s tipped workers. Set to be unveiled in her Executive Budget for fiscal 2027, the initiative seeks to exempt up to $25,000 of tipped income from state income taxes, a move expected to resonate with voters as her reelection bid draws near. This strategic proposal could have significant implications for the state’s economy and the livelihoods of service industry employees.

Thehill — No Tax on Tips: New York Governor Hochul's Bold Move for Tipped Workers

No Tax on Tips Proposal from Governor Hochul

New York’s Governor Kathy Hochul is stepping up with a no tax on tips initiative aimed at enhancing the financial situation of tipped workers across the state. In her upcoming

Executive Budget Proposal for Fiscal 2027

scheduled for release, Hochul plans to introduce a framework that would exempt up to $25,000 of tipped income from state income taxes. This significant proposal not only advocates for service industry workers but also aligns with Hochul's preparation for her reelection campaign this November.

The anticipated policy aims to provide financial relief to those who depend largely on tips for their livelihood, thus potentially boosting consumer spending and supporting local economies during challenging times. As she appeals to voters, the proposal’s economic effects could reverberate throughout New York’s financial landscape.

What This Means for New York Workers

Direct financial impact on tipped workers’ income.
Boosting the service industry’s economic recovery post-pandemic.
Potentially shaping voter sentiment ahead of upcoming elections.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.