Coronavirus

There's Something for Everyone To Hate in Sen. Martha McSally's Plan for Federally Subsidized Vacations

The Arizona Senator would give families an $8,000 tax credit, plus $500 for each child, to take a trip that's at least 50 miles from their home but not outside the United States.

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Sen. Martha McSally (R–Ariz.) wants to use the tax code to subsidize middle-class Americans' cross-country travel during the COVID-19 pandemic.

On Monday, the Arizona senator released the text of her Tax Rebate and Incentive Program (TRIP) Act, which would provide every American adult with a $4,000 tax credit they could spend on domestic vacations. Married couples who file jointly would qualify for an $8,000 tax credit, plus $500 for each child under 17.

"The tourism and hospitality industries were among the hardest hit sectors across the country and their revival is critical to our economic recovery," McSally said in a press release. "My legislation will help boost domestic travel and jumpstart the comeback of our hotels, entertainment sectors, [and] local tourism agencies."

The TRIP Act would allow taxpayers to write off money they spend on food, lodging, transportation, and live entertainment events, including sporting events for vacations they take between January 2020 and January 2022. This means McSally's bill would subsidize vacations taken before the first COVID-19 lockdowns went into effect.

McSally's bill also provides $50 million to support state and non-profit tourism marketing boards.

The travel tax credit would be nonrefundable, which means someone with no federal tax burden wouldn't be able to make use of it. That limits the costs of the tax credit but also ensures that its benefits will accrue mostly to wealthier taxpayers.

Bloomberg reporter Steven Dennis notes that the credit doesn't come with an income cap either, meaning even the highest income earners could claim it.

The bill has received some qualified support from former Democratic presidential candidate Andrew Yang.

President Donald Trump expressed support for an "Explore America" tax credit last month, although he gave few details about the policy.

The idea for a travel tax credit appears to be the brainchild of the U.S. Travel Association. The trade lobby has proposed a temporary $4,000 tax credit per household that could be spent on qualifying travel expenses like rental cars and restaurant meals.

Given how long everyone has been cooped up inside, the idea of a little getaway sounds pretty nice. Nevertheless, there's something for everyone to hate in McSally's proposal.

The fact that it'd effectively subsidize only middle- and upper-class tourists should irk progressives, who'd rather see the government spend money on unemployment benefits and other programs. Paid vacations, progressives argue, should be the mandated responsibility of employers.

 

Deficit hawks, meanwhile, should oppose a massive new tax credit that comes with no spending offsets, given the trillions in new spending Congress has already approved to combat the economic impact of COVID-19.

Public health scolds would be on solid ground when criticizing the TRIP Act for subsidizing non-essential travel in the middle of a deadly pandemic.

Critics of crony capitalism should be aghast at the idea that McSally's travel tax credit is double what the travel industry itself has proposed.

While libertarians might like the idea of a tax cut in the middle of a recession, the TRIP Act contains too much behavioral micromanagement: Taxpayers could only reclaim some of the money they owe the federal government if they take a vacation before January 2022, and if that vacation takes them farther than 50 miles from their home but not outside the U.S.

No matter your politics, McSally's TRIP Act is a terrible idea. Taxpayers should tell her to take a hike.

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  1. “ she also wants cut the pay of people who got laid off by about $12,000.”

    That’s a weird sentence.

    1. I think the implication is that she wants to reduce unemployment benefits.

      1. Reduce by allowing the emergency increase to expire?

        1. Not increasing is cutting. And ignorance is strength.

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  2. You don’t need stimulus spending to restart the tourism economy, just quit fearmongering and let people open their doors with no conditions and the industry will recover all on it’s own.

    Pretty standard government behavior here, it causes a problem through it’s own insistence on DOING SOMETHING, and then decides it needs to do more things to fix the problems that were caused by the other things they just did. JUST QUIT DOING THINGS FOR FUCKS SAKE.

    1. Government: If you think the problems we create are bad, just wait until you see our solutions.

  3. So since I will be living almost 600 miles away from my wife and kids this year, does that mean we could pull in a cool eight grand just for having them come down for a visit?

    1. So since I will be living almost 600 miles away from my wife and kids this year

      Sounds like you’re already on vacation!

      *rimshot*

      I’m here all week.

  4. Taxpayers should tell her to take a hike.

    BOOM. You’ve just been britschgied.

    1. she’s done. Mark Kelly is going to eat her lunch in November. As much as the thought of democrats having full control makes me want to hurl, good riddance.

      appointing her to the senate weeks after she lost an election for the senate was Ducey’s biggest blunder…and i mostly support the guy.

      1. She lost to one of the biggest weirdos* elected to the Senate. They are called the Stupid Party for a reason.

        * I before e except after c or as sounded as a as in neighbor or weigh. (unless you’re weird)

        1. exactly, when she couldn’t beat Sinema (who actually i’m mostly fine with) that should have been the end of her political career (as far as any office of significance is concerned).

          No one views her as deserving of her seat after that.

  5. Sure, I’d get a $4000 tax credit, but I’d also have to get a fishing license in another state.

  6. I mean it’s bad enough she’s a naked cronyist but it really fucks with the optics of taking away the unemployment bonus. A bad idea poisoning a good idea, classic government.

  7. The worse thing about the idea is the thought of subsidizing people to go on statue breaking sprees

    1. It’s basic public economics.
      Step one: Pay deadbeats subsidies to take time off and go smash public property.
      Step two: Create guaranteed jobs program to replace destroyed public property.
      Repeat.

  8. I don’t mind paying relatives when I visit if I get it back as a tax credit.

  9. stupider than McCain is not a goal.

  10. Tax credit?
    Who the hell pays more than 8K in taxes?
    Oh, wait. The same guys who need a SALT break. The stinking filthy rich.

    What should we expect from a party that either has not updated the party platform in 3 years, or opposes their own winning candidate.
    From the GOP platform, today:
    For the past 8 years America has been led in the wrong direction.
    The President and the Democratic party have dismantled Americans’ system of healthcare.
    The President has been regulating to death a free market economy that he does not like and does not understand.
    The President and the Democratic party have abandoned their promise of being accountable to the American people.

    Who knew the democrats were working so closely with Trump?
    So we DO have bipartisanship after all.
    Peace in our time.

    1. My wife and I paid just over 8k last year, its pretty easy to hit that mark when you don’t have kids

      1. My wife and I paid just over 8k last year, its pretty easy to hit that mark when you don’t have kids a decent CPA

        FTFY

        1. A decent CPA would charge me way more than they’d save me in taxes. The problem (if you insist on calling it that) is that with the higher standard deduction since the recent tax reforms we don’t have enough deduction to itemize, so we don’t need a CPA

    2. “Who the hell pays more than 8K in taxes”

      I’m guessing you don’t know what “1099” means.

    3. Its not hard to pay more than $8k when your self employed

  11. This might be the most god-awful thing I have ever heard of. On the other hand, I am retired, and, hell, ALL I DO is travel and “vacation.” So I guess the federal government would subsidize my trip to Yellowstone. You know, the one I was going to take anyway? What a completely stupid idea.

  12. There are ten year olds that realized all on their own that this Plandemic was nothing but a scam & a con game a full two months ago… How long till you people catch up?

  13. What an idiot.

  14. Rotten idea.

    Will SOMEONE please point to that part of Art 1 Sec 8 where Uncle Stupid has to play vacation manager, and/or decide which undistries “need help” so they will survive?

    How’s about stop HURTING all undistries by simply saying “the ChinaVirus is not what everone feared it would be, so everyone back to normal. Take off the hobbles and let the horse run as fast/far as he wants to. Duh………….

  15. Amazing when you basically can’t get anyone to agree with you. A true talent she’s got there.

  16. I think maybe the senator has been sampling the hand sanitizer.

  17. I’m not a fan of this legislation, but why is the lack of an income cap a problem? As someone who falls into the upper-middle class income group, it has really irked me that the federal government is handing out piles of money and everyone is getting relief except for in situations like mine. My wife and I are not business owners. We are both educated professionals whose combined income has taken a massive hit during the pandemic. But since our income is greater than some arbitrary number we get no relief, and this is despite the fact that our income has dropped by more than the median household income in the US.

    We are well positioned financially…we live well below our means and save/invest a significant portion of our income…so we will be fine. It just really bothers me that the government is handing out piles of cash to pretty much everyone else in this country. And we’re still on the hook for a federal tax bill that’s also greater than the median household income.

  18. Here’s a thought, how about direct energy and funding to address the coronavirus. If people were more confident that their health care needs would be met and that their paychecks were secure, they spend money and travel. McSally could do more if she called President Trump told him to improve access to testing and to set a good example by wearing a face mask in public. One of these would cost the taxpayer nothing, can you tell which that is?

  19. No matter your politics, McSally’s TRIP Act is a terrible idea.

    Here is where Reason stands:

    Cutting taxes on Chinese imports = great idea.

    Cutting taxes on US travel = terrible idea.

    Any questions?

    1. Yes, have you failed to notice that the tax on Chinese made products is affecting every American because it is on the purchase of the goods, while McSally’s is proposing a tax credit that essentially help the more affluent?

  20. Did she by any chance file this bill on April 1?

    I can almost see her, after all the Democratic Senators sign up as co-sponsors, withdrawing the bill and saying, “Boy. You guys will fall for anything.”

    1. That’s a good theory, but April 1 was a long time ago.

  21. Things are opening several promising vaccines are in testing. The virus will end and travel industry will return. If this stupidity gets passed it will go on forever.

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