The global health crisis has had a major economic effect across the board — especially on the tourism industry.
Walt Disney World Resort entrance
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.
Magic Kingdom
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.
Walt Disney World
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.”
Epcot
Remember, none of this is set in stone, but it is something that lobbyists are pushing.
Click here to see how the global health crisis has affected Florida’s economy.
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.
Beach Club Resort in Disney World
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.
Click here to learn more about the recession and its effects on Disney World.
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Would a tax break get you to go to Disney? Share your thoughts in the comments.
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I would certainly take a tax break if it was given for my vacation. Absolutely. I’m helping other businesses in their efforts to stay open. Win-Win!
The tax break for traveling wouldn’t help me much. I own DVC points. I already have an Annual Pass. So those are paid for already. I don’t need to fly to WDW since I only live about three hours away. I might get a credit for the food I purchase and maybe the gasoline I purchase.
Interesting part about this is it is a tax credit, not money provided directly. Meaning you need to have $4-8,000 available to spend and clear in order to file for this credit in your taxes and you must qualify for it too.
It’s a regressive approach according to economists and the overall value is best as a direct stimulus to avoid additional communication and overwhelming response then massive disappointment when people don’t qualify.
The ? money extra counts as income on your taxes you pay more on the tax return ! It is not free it sounds ?great but every time the government gives they take back ! If Disney opens themself and let’s everyone in the ? parks it would be better !
I wonder what the qualifications would be? If they instituted a tax deduction for travel it would be one of the few my family might qualify for. I would gladly travel for a tax break
Would this tax break be in effect for vacations in 2020 or only start for vacations in 2021?
It’s just speculation and a discussion right now. Not being marked up as a “break” but as another user commented looks like it’ll be considered as income before you’re provided a credit after you complete the trip. The overall cost is substantial.
I understand that part. We have the most expensive Disney trip we’ve ever taken planned for December 22-January 3 with a split stay between Copper creek and Saratoga. If this tax credit applies to 2020 taxes that we will file in 2021, the savings would be enough that we may not owe above and beyond our withholding, which is what always happens somehow, even though we have extra withheld. I’ll set up a google alert for this. Thanks.