McDonald’s CEO says Trump’s No Tax on Tips won’t Benefit its Workers

President Donald Trump’s no tax on tips policy will not benefit McDonald’s workers, CEO Chris Kempczinski said, because its restaurants do not have tipping.

Kempczinski said he supports the no tax on tips policy, but it does not help McDonald’s restaurant staff. (Photo: Saverio Truglia, Harvard Business School)

Instead, the policy gives businesses that pay smaller wages to tipped workers an outsized advantage, Sasha Rogelberg reported for Fortune.

McDonald’s employees will not only see no benefits from Trump’s initiative, but the policy also highlights inequities between businesses that pay workers the federal minimum wage versus those that rely on lower base wages supplemented by tips, Kempczinski said.

The fast-food executive told CNBC’s Squawk Box that while he supports the no tax on tips policy, it does not help McDonald’s restaurant staff.

"The issue with no tax on tips is it only benefits those restaurants that have tips,” he said. “We don’t do tipping in McDonald’s, and so we don’t get the benefit of, essentially, that tax relief there.”

Trump included the no tax on tips measure as part of the One Big Beautiful Bill he signed into law in July. The legislation allows for up to a $25,000 federal income tax deduction from reported tips.