California and Washington state posted the lowest average restaurant tip rates in the country in the final quarter of 2025, underscoring how high-tax, left-leaning jurisdictions are increasingly out of step with the rest of America.
Residents in both states tipped nearly 2% less than the national average of 19.2% at full-service restaurants, according to a report from Toast. As reported by the Daily Caller, California already burdened with one of the highest marginal state income tax rates in the nation and Washington, which recently imposed a 9.9% tax on incomes over $1 million, now sit at the bottom of the tipping table.
California ranked dead last for average tips at full-service restaurants in the fourth quarter of 2025 at 17.2%, with Washington close behind at 17.6%. Washington, D.C., another deep-blue jurisdiction, also ranked near the bottom in tip rates, according to Axios.
By contrast, Delaware led the nation in tip rates at full-service restaurants in the same period, coming in at 21.8%. Tips at quick-service restaurants held steady nationwide at 15.8%, suggesting the decline is concentrated in sit-down establishments where workers rely most on gratuities.
Californias top income tax rate stands at over 13%, with additional city and local levies pushing the effective burden even higher. The state has suffered a major outflow of residents since 2019, shedding over $91 billion in net income between 2019 and 2023, according to the New York Post.
Activists in California are now pushing to gather enough signatures to place a one-time 5% billionaires tax on the November midterm ballot. Such a measure threatens to accelerate the ongoing flight of capital and high earners from the states already fragile tax base.
Democratic Washington Gov. Bob Ferguson signed into law a 9.9% tax on incomes over $1 million on March 30. Democratic Seattle Mayor Katie Wilson went further at a September 2025 campaign event, where she threatened grocery chains in her city, saying she would not allow them to close and even threatened to institute government-run grocery stores.
Wealthy business leaders have responded with their feet, with Tesla CEO Elon Musk and Meta CEO Mark Zuckerberg both relocating their residences out of California. Former Starbucks CEO Howard Schultz likewise announced in March that he was leaving Washington for Florida, a state known for low taxes and a friendlier business climate.
At the federal level, President Donald Trump moved in the opposite direction of blue-state tax-and-spend policies by signing a tax exemption on tipped income into law on July 4, 2025. After campaigning on the measure in 2024, he delivered a policy that directly benefits service workers, even as progressive state governments pile on new taxes that appear to be dampening generosity at the table.
Login