DelBene Discusses Importance of Expanding Tip Tax Credit with Local Salon Owners
Congresswoman Suzan DelBene (WA-01) held a roundtable in Redmond to discuss the importance of extending the FICA tip tax credit to employer-based beauty establishments. DelBene sat down with salon owners in Redmond and talked about how creating parity will help businesses and their workforce. This month, Rep. DelBene helped introduce bipartisan legislation to empower small businesses by extending the tip tax credit to the beauty service industry.
“Hearing directly from these employers underscored the importance of extending the tip tax credit to the beauty service industry, where most of the businesses are owned by women and minorities. We need to make sure they can compete on the same playing field as other industries like food service, who already take advantage of the tip tax credit. Bridging the gap between this disparity is one way we can support women-owned businesses and expand our middle class,” said Rep. DelBene.
The tip tax credit is part of an integrated compliance system that helps ensure accurate reporting of tip income to address tax gap concerns and reimburse employers for the implementation of systems and processes to ensure proper payment of taxes. Extending the tip tax credit should reduce tax burdens for small businesses, improve reporting of tip income and allow them to reinvest in their employees, as it did in the food and beverage industry.
According to the Bureau of Labor Statistics, the number of barbers, hairstylists, and cosmetologists is projected to grow 13 percent from 2016 to 2026. As more businesses hire more people, it will be critical for those small businesses in the beauty service industry to have the same tax breaks offered to other industries.
Rep. DelBene is a member of the House Ways and Means Committee, and is Vice-Chair of the New Democrat coalition. She represents Washington’s first congressional district.