The global health crisis has had a major economic effect across the board — especially on the tourism industry.
With such a major drop in revenue for the travel industry, the national government is reviewing ways to get the sector back on its feet. They’ve already employed a multi-billion-dollar stimulus for airlines, and now they may even incentivize travel with a tax break.
Lobbyists are pushing to provide tax breaks for American travelers.
According to the Orlando Sentinel, lobbyists are currently pushing for a plan that would provide up to $4,000 in tax breaks for those who begin traveling and spending money at hotels, theme parks, and more.
One example that has been proposed is the Explore America tax credit. This would be an income tax credit worth up to 50% of a household’s expenditures on travel like airfare, hotel rooms, tickets, and meals. The cap would be at $4,000 per household and would apply through the end of next year.
Interestingly, the tax break is modeled after a credit that was implemented for some homebuyers during the 2008 housing crisis.
A lobbyist for the Walt Disney Company, Tori Emerson Barnes, noted that the government will need to continue spending to revitalize the tourism industry. “Right now, our businesses need relief,” she said, “But ultimately, we’ll need recovery.”
Unions have gotten involved as well noting that any aid to big travel should come with stipulations that improve conditions for frontline workers. A representative from the union that organizes several Disney World employees, UNITE HERE, noted, “I think we really need to move from incentives to requirements to get these companies to do the right thing.”
Remember, none of this is set in stone, but it is something that lobbyists are pushing.
Why would we get a tax break for taking a vacation?
Now we know what you’re thinking: Why would the government PAY US to go on VACATION!? Let’s break it down. As we mentioned, tourism is one of the industries that has been hit the hardest by the global health crisis and has already been a major beneficiary of economic relief.
People are especially wary about travel right now. A tax break like this could incentivize people to travel despite their unease about the economic downturn and health concerns. John Bortz, CEO of Pebblebrook Hotel Trust explained, “I think there’s a recognition that travel overall is going to need to be stimulated, and that will take dollars.”
We’ll see what comes of this plan in the coming days and months and keep you posted as we learn more.
Would a tax break get you to go to Disney? Share your thoughts in the comments.