At a recent campaign rally in Tucson, Arizona, former President Donald Trump outlined his latest proposal aimed at boosting workers’ disposable income: eliminating taxes on overtime pay.
The plan, according to Trump, is intended to incentivize overtime work and help hard-working Americans, particularly those in roles like police officers, nurses, factory workers, and truck drivers, to take home more of their earnings.
Trump emphasized that those who work beyond 40 hours a week often belong to the backbone of America’s labor force, and this tax cut would give them more financial breathing room.
“Those are the people, they really work,” Trump told the crowd. By making overtime pay tax-free, he argued, the plan would not only benefit workers but also companies by encouraging a more motivated workforce.
This proposal is part of a broader effort by Trump to flip Arizona red in 2024, a state President Joe Biden narrowly won in 2020. In addition to cutting taxes on overtime pay, Trump has promised to eliminate taxes on Social Security benefits and stop taxing tips for service workers.
Vice President Kamala Harris, Trump’s opponent, has also pledged to end the taxation of tips, but she is pushing for a minimum wage increase alongside that proposal.
While these ideas might resonate with working-class voters, they come with significant fiscal implications. The Committee for a Responsible Federal Budget estimates that eliminating taxes on tips and increasing the minimum wage could add between $100 billion and $200 billion to the national deficit over the next decade.
Trump’s plan, which appeals directly to workers who clock significant overtime, is designed to give him an edge with middle-class and working-class voters—key demographics in swing states like Arizona.
Whether this plan will gain traction remains to be seen, but it’s clear that Trump is focusing on economic populism as a central theme of his campaign.
