As non-Americans avoid the US, Las Vegas workers can't cash in on Trump’s 'no tax on tips’ policy. Here's why

Tourism in Las Vegas is down since last year — and tip-dependent workers, like bartenders and dealers who rely heavily on tourist traffic, are especially vulnerable, even with Trump’s ‘no tax on tips’ policy. The Wall Street Journal reports that tip incomes in Las Vegas are shrinking across the board.

While tip tax exemptions might sound appealing to Las Vegas workers, some are expressing doubt about how much of a difference it will make with tourism slowing. “The tip tax break won’t mean much if there’s no one at the gaming tables or no one dining out,” Senate Majority Leader Nicole Cannizzaro (D-Las Vegas) said during a bill hearing.

And you don’t have to be a betting man to see how a slowdown in tourism is rippling through Nevada’s service economy.

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What’s happening in Vegas?

Las Vegas is one of the country’s most tourism-reliant cities. In April, 3.3 million people visited Las Vegas — a year-over-year drop of 5.1%. Year to date, visitation is down 6.5% for 2025, according to the Las Vegas Convention and Visitors Authority (LVCVA).

Passenger traffic at Harry Reid International Airport continued its decline in June — both domestically and internationally — with the airport reporting a 6.3% year-over-year decline. Year to date, it’s seen a 4.1% decline.

As a whole, the U.S. is projected to lose $12.5 billion in international visitor spending this year, according to a report from the World Travel and Tourism Council (WTTC).

Julia Simpson, WTTC president and CEO, said in a statement, “While other nations are rolling out the welcome mat, the U.S. government is putting up the ‘closed’ sign.” The report states that this loss in tourism will deal a blow to the U.S. economy overall, “impacting communities, jobs, and businesses from coast to coast.”

President Donald Trump’s talk of making Canada the 51st state — along with trade disputes — has driven Canadian tourists away.

But arrivals are also down from other key markets, including the U.K., Germany and South Korea. Media reports of detentions at U.S. border crossings, along with government travel warnings, are causing many international travelers to steer clear.

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Even domestic tourism has slowed as rising costs and recession fears prompt Americans to cut back on discretionary spending. “Consumers aren’t feeling confident and that doesn’t bode well for the remainder of 2025,” Jan Freitag, national director of hospitality analytics for the CoStar Group that tracks travel across the country, told CDC Gaming. “Las Vegas is a market where people use their discretionary income.”

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How the tourism slump is hitting tipped workers

That slowdown has real consequences in Nevada, where it’s estimated that more than 5% of workers rely on tips, according to the Tax Policy Center. That’s higher than most other states. From bartenders to blackjack dealers, fewer visitors means fewer chances to earn gratuities.

Social chatter also indicates that some Americans are fed up with the “absurd” resort fees and high prices. And this could be making it less enticing as a travel destination for Americans who are struggling to make ends meet.

Some locals say their earnings have dropped by as much as 50%, reports the Wall Street Journal. Charlie Mungo, a 36-year-old tattoo artist, told WSJ he used to earn $3,000 to $6,000 a month including tips — now he’s making about $1,500.

Trump’s “no tax on tips” policy, which exempts up to $25,000 in tips annually from personal income taxes, was meant to boost take-home pay for service workers. But as Mungo puts it, “It doesn’t really do us much good if there isn’t any people to get tips from.”

What you can do to shore up your finances

For tip-dependent workers in Las Vegas — or anywhere in the country — worried about their future, they can take steps to shore up their finances in the same way one would prepare for a recession.

Plan ahead: ”Make sure you identify the minimum you can spend in a given month to get by, just in case you or your spouse/partner experiences a job loss,” according to advice from Equifax. Create an emergency fund: It should cover at least three to six months of those essential expenses. Prioritize the most important payments: If you do get in a financial situation where you’re unable to cover your expenses, make sure to pay your rent or mortgage on time (to avoid eviction) and make car payments (if you need your car to get to work). Negotiate credit card payments, if needed: If your income has been reduced and you’re struggling to keep up with your bills, contact your creditors and ask for a payment plan or hardship concessions, says Equifax. “This might include making interest-only payments on your debt or putting payments into forbearance.”

Even the best budgeting strategies can only go so far when the local economy depends on visitors who aren’t showing up. In Las Vegas, every drop in tourism sends ripples through the service industry, hitting tip-dependent workers first and hardest, and that reality isn’t unique to Nevada.

“What happens in Las Vegas matters on a national scale because it often reflects larger trends,” Andrew Woods, director of the Center for Business and Economic Research at the University of Nevada, Las Vegas, told NPR. “It tends to be a signal for potentially where the economy’s headed.”

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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