McSally introduces bill to incentivize Americans to take a vacation

Republican Sen. Martha McSally (Ariz.) introduced a bill Monday that would give Americans tax breaks for going on vacation during the coronavirus pandemic. 

The bill offers a tax credit worth up to $4,000 for individuals or $8,000 for joint filers — plus an additional $500 per dependent child — for money spent on domestic lodging, transportation, and food and drinks. 

Any purchases that took place at least 50 miles from a principal residence qualify for the tax break. The purchases must take place between Dec. 31, 2019, and Jan. 1, 2022.

McSally says the bill would soften the economic blow of the coronavirus pandemic and foster job growth. 

“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 statement.

“Arizona has lost billions in revenue this year alone due to the pandemic. My legislation will help boost domestic travel and jumpstart 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,” McSally added.

The U.S. Travel Association, which issued a statement supporting McSally’s bill, has proposed an “Explore America” tax credit.

Many were quick to point out that the bill could be a big giveaway to wealthier households. One portion allows people with a second home to write off the costs of live entertainment, though not the mortgage on the second home or other home-related expenses. 

Matthew Gardner with the Institute on Taxation and Economic Policy called McSally’s bill “an invitation to tax avoidance.” He also noted that she voted against increased unemployment benefits in the COVID-19 stimulus bill signed into law in March.

McSally, an Air Force veteran, is in a close Senate race with Democratic challenger Mark Kelly, a Navy veteran. A collection of polling averages from RealClearPolitics shows Kelly with a solid lead, 49 percent to 39 percent.

The state Democratic party also criticized the bill, arguing McSally had her priorities wrong.

“Instead of standing up to oppose her party’s lawsuit to end health care coverage protections or fighting for direct relief funding for Arizona communities, Martha McSally is pushing another corporate industry group-backed tax giveaway to wealthy families that will encourage people to travel during a pandemic,” Brad Bainum, an Arizona Democratic Party spokesperson, said in a statement.