In a recent campaign event, Donald Trump, the Republican presidential candidate, unveiled a new tax proposal aimed at American workers. Speaking to supporters in Tucson, Arizona, on September 12, 2024, Trump announced his intention to eliminate taxes on overtime pay if elected in the upcoming November 5 election.
"As part of our additional tax cuts, we will end all taxes on overtime. Your overtime hours will be tax free."
This promise is part of a broader tax reform package proposed by the former president. The U.S. tax code, which currently spans over 74,000 pages, has been a frequent target for reform by presidential candidates. Trump's plan to make overtime earnings tax-free would significantly impact workers who often exceed the standard 40-hour workweek.
The concept of overtime pay, which typically amounts to 1.5 times the regular hourly wage for extra hours worked, has been a cornerstone of American labor law since the Fair Labor Standards Act of 1938. Trump's proposal seeks to enhance the benefits of this long-standing practice by removing the tax burden on these additional earnings.
In addition to the overtime tax elimination, Trump has previously expressed his intention to end taxation on tips for service industry workers. This move could potentially provide significant relief for those in the hospitality sector, where tips often constitute a substantial portion of income.
The former president's economic proposals extend beyond tax policy. Trump has also indicated his willingness to exert pressure on the Federal Reserve to lower interest rates. The Federal Reserve, established in 1913, plays a crucial role in U.S. monetary policy, with a dual mandate of promoting maximum employment and maintaining stable prices.
As the election approaches, polls suggest a tight race between Trump and his Democratic opponent, Vice President Kamala Harris. Harris, who made history as the first woman, first African American, and first Asian American to serve as U.S. Vice President, has put forward similar pledges regarding tip taxation.
The upcoming election, set for November 5, 2024, will determine the 47th President of the United States. As with previous elections, the outcome will be decided by the Electoral College system rather than a direct popular vote. Arizona, where Trump made his recent announcement, has emerged as a key battleground state in recent electoral cycles.
As the campaign intensifies, both candidates are likely to participate in presidential debates, which have historically played a significant role in shaping voter opinions. With less than two months until Election Day, American voters will be closely scrutinizing the economic plans and tax proposals of both candidates as they make their decision at the ballot box.