WICHITA — It’s a busy Friday afternoon at The Monarch bar and restaurant in downtown Wichita, and food server Kelly Bonnell is right at home.
As she grabs a customer’s sandwich and fries from the kitchen, she greets people that come and go — all the while smiling and full of energy.
“I’m not sitting in a cubicle working on a computer. I’m impacting other people, and I’m having fun,” Bonnell said. “I genuinely enjoy it.”
Bonnell’s been serving for 10 years, first in Missouri and later in Wichita. She works at two restaurants in town and said she makes enough in tips to get her through school at Wichita State University.
But her first year in Kansas, Bonnell was hit by a tax surprise. Since the minimum wage for tipped workers in Kansas is lower than in Missouri, the taxes automatically taken out of her hourly wages at a previous job didn’t cover what she owed.
“And it was hard,” she said. “I did not have the expectation of needing this massive amount of money to pay that back.”
BONNELL IS NOW setting aside part of her tips to cover taxes, but a bill in Kansas would potentially eliminate the need for that altogether. The bill would exempt up to $25,000 in a worker’s annual tips from state income tax.
The same idea has been floated by President Donald Trump’s administration at the federal level, but its fate in Congress is uncertain. That could ultimately decide whether the state does away with income taxes on tips, too.
Kansas Senate President Ty Masterson has said it’s a commonsense measure that won’t affect the state’s bottom line.
“If the federal government takes tax off tips, how crazy would it be for (them) to have to then maintain their tips and then pay Kansas tax on those?” Masterson said.
REPUBLICAN Sen. Caryn Tyson chairs the Senate’s tax committee. She introduced the bill to cut taxes on tips.
“I support Kansans — hard-working Kansans keeping more of their own money,” she said. “The more they can keep in their pockets, the better off the state is.”
If federal lawmakers do move, Kansas lawmakers seem open to following their lead. But there are some people in Topeka who believe cutting taxes on tips is not enough.
Nathan Kessler is a tax policy adviser with Kansas Action for Children. He said the tax cut would only benefit a small portion of workers.
“If the goal is to put more money in the pockets of tipped workers there are much better ways to do that,” he said. “The most efficient would be to raise the minimum wage for those workers in Kansas.”
