Administration

Trump defends economic policies, casts aside ‘fake inflation’ amid Iran war

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by Sarah Davis - 04/16/26 9:10 PM ET

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by Sarah Davis - 04/16/26 9:10 PM ET

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President Trump defended his administration’s economic policies at an event in Las Vegas on Thursday amid rising energy costs resulting from the U.S.’s conflict with Iran.

Trump cast doubt on a recent Labor Department report that showed a 0.9-point hike in inflation last month. This was the highest consumer price spike in nearly four years, and it was primarily driven by increased energy costs.

“Don’t forget, we’re having some fake inflation because of the fuel, the energy prices,” the president told the Nevada crowd.

The Trump administration has emphasized that these rising costs are only “short term” pains. On Thursday evening, the president urged Americans to “see what happens over the next week or so.”

“You know, I think you’re going to be very impressed,” Trump told the crowd. “And if you are, vote for the Republicans in the midterms.”

The cost of international benchmark Brent crude oil soared at the end of March, after Iranian counterstrikes in the Gulf region effectively closed a major oil trading corridor, the Strait of Hormuz. Energy markets began to cool after the president announced a temporary pause in fighting with Iran during diplomatic peace talks last week.

Trump made affordability a cornerstone of his 2024 presidential campaign, and cost of living concerns are expected to play a large role in the upcoming midterm elections.

The Las Vegas event on Thursday centered on the Trump administration’s “no tax on tips” policy goal, which passed under the “One Big Beautiful Bill Act” last year. The law eliminates federal taxes on tips for over 60 service industry jobs.

Treasury Secretary Scott Bessent, Sen. Tommy Tuberville (R-Ala.) and Nevada Lt. Gov. Stavros Anthony (R) were present at the roundtable event.

The law applies to service employees working in Las Vegas’s booming casino industry. Around 180,000 workers in the Las Vegas metropolitan area work for tips, according to an estimate last year from the University of Nevada.

“Thanks to our tax cuts this week, thousands of Nevada waiters, waitresses, casino dealers, bartenders, bellmen, barbers, caddies … receive the biggest tax refunds of their entire lives, and you see it,” Trump said. “And I just want to say, you’re welcome.”

Workers covered by the law also qualify for tax deductions of up to $25,000 in tips if they report an annual salary of less than $150,000. For every $1,000 workers make beyond this maximum income threshold, the amount they can deduct is reduced by $100. The act confers additional deduction benefits for overtime hours.

Trump said on Thursday that more than 26 million Americans have already claimed this tax benefit.

“Every single American at every income level has more money in their pockets this week because of the Republican tax policies, and we’ve got to win the midterms,” Trump said. “If we don’t, these policies are going to be taken away from you. The taxes are going to go through the roof.”

The measure had broad political support in Congress, and the National Restaurant Association applauded the move in a press release after the legislature passed the funding bill last summer.

“This recognition will put cash back in the pocket of a significant number of these hard-working people and could help restaurant operators recruit additional talent,” said the organization’s president and CEO, Michelle Korsmo.

However, the move received pushback from the Independent Restaurant Coalition (IRC), which urged the Treasury Department last October to broaden the measure to include service charges and automatic tips under the deduction.

The IRC’s executive director, Erika Polmar, warned in a letter to Bessent that “the proposed regulations may unintentionally prevent a significant portion of restaurant employees from utilizing the deduction.”

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