Senator Rosilicie Ochoa Bogh (R–Yucaipa) has announced Senate Bill 17 has passed the Senate Revenue and Taxation Committee. The bill would allow California service workers to deduct up to $20,000 of their tipped income from state taxes, providing much-needed relief to a workforce that disproportionately includes women, people of color, and single parents.
“I’m grateful to the committee chair, Senator McNerney, and the other members for their support of this important tax relief measure for California’s service workers,” said Senator Ochoa Bogh. “For too long, tipped workers have been taxed on inconsistent and unpredictable income. SB 17 recognizes the reality these workers face daily and ensures they can keep more of what they earn. This issue is personal, and I am proud to fight for hard-working Californians who power our restaurants, salons, and hospitality industry.”
Under SB 17, workers earning tips would be eligible for the deduction if their adjusted gross income is under $125,000 for individuals or $250,000 for joint filers. The bill also updates the state’s tax code to align the definition of tips with federal standards while excluding licensed professionals—except barbers and cosmetologists—from claiming the deduction.
The California Chamber of Commerce thanked Senator Ochoa Bogh for her leadership on SB 17 stating, “This measure will not only help attract and retain workers in the service industry, but also ensure that more hardworking Californians can keep the earnings they rely on to support their families. We appreciate the Senator’s commitment to policies that strengthen our workforce and improve economic stability for working families across the state.”
This bill aims to bring much-needed relief to Californians who rely on tips to survive. This measure reflects a growing bipartisan recognition that tips serve as a reward for exceptional service rather than a predictable income source.
“Californians pay some of the highest state taxes in the country and tax relief for hard-working people is long overdue,” said Jon Coupal, President, Howard Jarvis Taxpayers Association.
SB 17 will now be moved to its next committee.