$4,000 stimulus check: why did Trump propose the 'Explore America' tax break?

Millions of Americans are still waiting to hear news about a second stimulus check. The HEROES Act has been passed by the House of Representatives but still needs to be turned into a bill by the Senate. Over 40 million United States citizens have lost their jobs during the coronavirus pandemic and the unemployment benefits are set to end on 31 July. The first stimulus check, which amounted to $1,200, has been spent on food and rent by citizens as they await news on more economic relief.

The Democrat-led House of Representatives approved the HEROES Act, a $3 trillion stimulus package that among other measures would give millions of eligible Americans a second round of stimulus payments to help them with the economic effects of the Covid-19 pandemic. That bill has been labeled "DOA", Dead on Arrival, by the Republican-controlled Senate because they are unwilling to pass a bill with such a high cost.

Donald Trump mentioned the ‘Explore America’ tax credit during a talk with restaurant industry executives last month and while he didn’t say a whole lot, he did mention it being a tax break for Americans to “use for domestic travel, including visits to restaurants.” The tourism industry has been hit particularly hard during the pandemic with millions of workers in that area being laid off or having their hours reduced.

Trump says the Explore America $4,000 tax break is a 'big deal'

Trump said it was “a big deal” as he tries to kickstart the economy and help out small business. It seems as though this is an attempt to keep businesses afloat instead of handing people money via stimulus checks. It would also get people to put money directly back into the economy.

See how stimulus check money is created

The credit, which the US Travel Association says should apply to any expense over $50 on things such as "meals, lodging, recreation, transportation, amusement or entertainment", would remain in force until the end of 2021.

The Explore America $4,000 tax credit would not be direct money and it would increase spending. The limits those in need who have to pay for rent and basic utilities rather than thinking about dining out. It might also increase jobs and reduce unemployment, which would save the government even more money in the long term. They have also thrown the idea of a job-seekers’ bonus, paying those who find work a sum of money as an incentive.

Second stimulus check not ruled out

The Trump administration is also open to including a second round of stimulus checks in the next Covid-19 relief bill along with the $4,000 tax relief, according to Treasury Secretary Steve Mnuchin. Speaking at a hearing of the Senate Committee on Small Business and Entrepreneurship last week, Mnuchin said: "I think we're going to seriously look at whether we want to do more direct money to stimulate the economy."

Stimulus Check vs $4,000 Travel Tax Credit: what is the difference?