A $4,000 tax credit most likely won’t be included in a second coronavirus stimulus check that was mentioned by President Donald Trump last month, according to a financial expert.
The president floated the idea of a tax deduction proposal called “Explore America” during a roundtable discussion in May, which would give people up to $4,000 in credits for domestic travel.
President Donald Trump floated the idea of a travel tax deduction for Americans[/caption]
“Create an ‘Explore America’ — that’s ‘Explore,’ right?” Trump said.
“Explore America tax credit that Americans can use for domestic travel, including visits to restaurants,” he added. “That’s a big deal.”
The credit would include booking vacations at hotels, visiting restaurants, and other tourist destinations across the country for a period that would last through the end of 2021.
If approved, the tax credit would be a lift for the tourism industry, which has been devastated by the coronavirus crisis since March.
But, according to Jim Wang at Forbes, the $4,000 tax credit is unlikely.
Wang explains that the credit “won’t help Americans who are hurting the most,” as it would give tax credits to people for traveling.
It’s been three months since Trump signed the CARES Act that gave Americans $1,200 stimulus checks[/caption]
But if Americans are unemployed and without money or a stable income, they’re unlikely to spend money traveling.
Wang noted that tax credits are credited very slowly: “To get the travel tax credit, you would need to take a trip, spend the money, and then wait for it to come back to you as a tax credit next year.”
He also explained that “only those who can afford it will benefit.”
“This means that if politicians were to include this, they would have to answer questions about why they would be willing to pass a tax credit that very clearly benefits those who have the means to travel right now.”
He continued: “This would very quickly transform into – ‘Why do rich people need a $4,000 tax credit to travel more?’ That’s a very uncomfortable question that no politician wants to answer.”
Wang noted that would be “assuming people are even comfortable traveling in the first place.”
Since Trump mentioned the tax credit last month, little to no details about it have emerged.
White House trade adviser Peter Navarro, however, said in a recent interview with CNN that Trump would prefer the second coronavirus relief package to be at $2trillion.
The middle ground amount is $1trillion less than House Speaker Nancy Pelosi wants, but $1trillion more than what Senate Majority Leader Mitch McConnell would like.
Navarro stressed the importance of manufacturing jobs and said that it should be “Buy American,” “Hire American,” and “Make it in the USA.”
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Navarro said he was confident that another stimulus package is likely to come at the end of the summer.
This means that Americans may receive a second check or it could refer to funding for businesses in specific sectors.
It’s been three months since Trump signed the CARES act to provide millions of Americans with coronavirus stimulus checks.