- A new bill from GOP Sen. Martha McSally would encourage people to travel around the US by effectively paying them $US4,000.
- The nonrefundable tax credit could be applied through the end of 2021, and the trip must be 50 miles beyond a person’s “principal residence.”
- But experts said low-income people would likely be left out of the plan.
- Others said it may not be a good idea to encourage travel during a pandemic.
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A new Republican bill would give each American $US4,000 to take a vacation anywhere in the US through the end of next year.
Sen. Martha McSally unveiled the proposal on Monday, called the American Tax Rebate and Incentive Program Act, or the American TRIP Act. It would give each person a tax credit, meaning they would have to apply to write off up to $US4,000 in travel-related expenses in tax forms.
That threshold would be doubled to $US8,000 for couples and add $US500 per child for all travel within the US to cover food, drinks, lodging, live entertainment, and transportation, including airfare and car rentals.
It would apply to trips taken between December 31, 2019, and January 1, 2022, meaning people could write off a vacation taken earlier this year. The tax credit would apply only to journeys that are 50 miles beyond a taxpayer’s “principal residence.”
‘The tourism and hospitality industries were among the hardest hit sectors across the country and their revival is critical to our economic recovery,” the Arizona senator said in a press release, adding that the state shed billions in travel-related revenue as a result of the coronavirus pandemic.
“My legislation will help boost domestic travel and jump-start the comeback of our hotels, entertainment sectors, local tourism agencies, and the thousands of businesses that make Arizona one of the best places in the world to visit,” she said.
She added: “It will also encourage Americans to safely get out of their homes and discover or rediscover Arizona along with the rest of the amazing destinations our country has to offer after a difficult several months stuck inside.”
Critics, however, were quick to say a significant portion of the public would be left out from the plan. Michael Linden, a fellow at the Roosevelt Institute, a progressive think tank, said in a tweet that many low-income people wouldn’t qualify for the credit.
Other experts questioned the wisdom of encouraging domestic travel during a once-in-a-century pandemic, which could spread the coronavirus. Cases are on the upswing in Arizona, a state that started easing its economic shutdown last month, according to The New York Times.
The plan from McSally mirrors one pushed by the US Travel Association to encourage people to travel around the US. In May, President Donald Trump also floated the idea of the “Explore America” tax credit during a roundtable with restaurant executives, USA Today reported, and his administration discussed pushing for it in the next economic relief bill set to be debated next month.
McSally, who served in the Air Force, is locked in a close Senate race with Democratic challenger Mark Kelly, a Navy veteran. A collection of polling averages from Real Clear Politics shows Kelly with a solid lead, 49% to 39%.
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Correction: The story initially said the proposed tax credit was refundable. It’s non-refundable, and the story has been updated.