A senator’s recent call for a $4,000 travel tax credit to boost the country’s stunted tourism and hospitality industries was ridiculed by one financial expert.
“That idea [is] one of the wackiest I’ve come across in recent months in an effort to stimulate the economy,” Ric Edelman, founder of Edelman Financial Engines, told Yahoo Finance. “It’s tone deaf and doesn’t acknowledge that there are millions of American households who can’t afford to pay their rent or afford to buy food or medicine.”
“The last thing they’re able to do is say ‘Let’s go on vacation!’” he said.
Sen. Martha McSally (R-AZ) this week proposed legislation called the American TRIP Act that would provide a tax credit worth $4,000 per individual or $8,000 per joint filers — plus an additional $500 per dependent child — for money spent on lodging, entertainment, and other expenses related to travel in the United States and its territories beginning in 2020 through 2022.
According to McSally, the bill encourages Americans to spend money on travel to jumpstart the country’s economy, namely the hospitality and entertainment sectors, after “a difficult several months stuck inside” during the pandemic lockdowns.
Intimating that McSally’s bill is a move to pander to the travel lobby and less about her constituency, Edelman interpreted it as a “desperate” bid for members of Congress to seal up their reelection campaigns.
Edelman acknowledged the need for continued stimulus for Americans, but underscored that the immediate need “is to get the money into people’s hands who desperately need the money, who need the money [the] most, and who need the money the quickest.”
Criticizing McSally’s plan to offer tax deductions that won’t be filed until 2021, Edelman was quick to point out that it doesn’t help Americans in the near term or do anything to stave off the “rate of poverty [that] will otherwise skyrocket in this country.”
“There’s too much ivory-towerism taking place in Washington,” Edelman said. “Not enough recognition of what’s really happening. Too much wishful thinking and not practical application of what we’re facing.”