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Travel and tourism is the second largest U.S. services export.

PRESS RELEASE

For Immediate Release

TRAVEL AND TOURISM INDUSTRY GAINS MOMENTUM ON CAPITOL HILL

TBR-Led Meetings Increase Interest In Travel Tax Credit And Other Ways To Stimulate The Economy

WASHINGTON, D.C. - October 15, 2001 -- In a series of recent high-level meetings with Congressional leaders and Administration officials, the Travel Business Roundtable stressed the urgent need for timely government action to stimulate travel and tourism.

As a result of these meetings, Senate leaders, including many members of the Senate Finance Committee, expressed interest in a limited tax credit for personal travel, and other tax incentives designed to stimulate travel and tourism.

"Rather than seek a bailout, the best way to help the travel and tourism industry and the eighteen million people it employs is to get people traveling," said Jonathan Tisch, Chairman and CEO of Loews Hotels and Chairman of the Travel Business Roundtable. "To that end, we are offering policymakers an array of options to address three key areas of concern: The well being of our workers who have lost or will lose their jobs; ways to encourage the resumption of travel; and the creation of greater liquidity for employers and employees."

The industry, which contributed nearly $100 billion in tax revenues last year, has been severely and directly impacted by the terrorist attacks of September 11th and the ongoing war on terrorism.

If the industry doesn’t begin to regain some momentum, it is projected that one million people across America could lose their jobs in the travel and tourism industry. The crisis in the travel and tourism industry impacts individuals and businesses across our country, in all 50 states and all 435 congressional districts.

In addition to a tax credit, as a result of the intense efforts by TBR, support is growing for the restoration of the business meal and entertainment deduction to 100 percent, as well as the restoration of the spousal travel deduction to 100 percent. Both measures would encourage people to start traveling, stimulating economic activity, and saving thousands of jobs.

Even in the wake of increased security at airports, people are still reluctant to travel. In a poll recently released by TBR, one in five of those surveyed said they would discourage close relatives or friends from traveling during the holidays. The government needs to send a strong signal that one important way for our country to recover - both economically and psychologically - is to travel.

After meetings last week with over a dozen United States Senators, the Speaker of the House Dennis Hastert, (R-IL), and Mr. Karl Rove, Senior Advisor to the President, the compelling story of the national crisis in the travel and tourism industry is being recognized. The need to focus on the travel and tourism industry is gaining considerable momentum among key decision makers. Senator Jon Kyl, (R-AZ), and Senator Zell Miller, (D-GA), have introduced legislation which would allow up to a $500 tax credit for individuals, or up to $1000 for couples filing joint returns, for personal travel-related expenses incurred from the time legislation is passed through December 31, 2001.

Senator John Breaux, (D-LA), a member of the powerful Senate Finance Committee, recognizes the tremendous impact that travel and tourism has on the economy, and is a strong supporter of restoring the business meal and entertainment deduction to 100 percent from the current status that allows up to 50 percent.

Senators Bill Nelson, (D-FL), and Bob Graham, (D-FL), have pledged to draft legislation that would both help the industry, its workers, and the nation’s economy. Senator Byron Dorgan, (D-ND), Chairman of the Senate Commerce Committee’s Subcommittee on Tourism, held a hearing on Friday, October 12th, 2001, to review the critical state of the travel and tourism industry. A TBR member participated as a witness at this hearing.

In addition, at the suggestion of the TBR, Senator Harry Reid, (D-NV), will convene a bi-partisan meeting of Senators who are concerned about the travel and tourism industry today. He is looking to build consensus on measures that would provide an immediate stimulus for the nation’s travel and tourism economy, mindful of the ripple effect it has across the country. Travel and tourism is the first, second or third most important industry in 28 states and the District of Columbia.

The devastating impact of recent events on this industry is becoming more clear: Airlines have reduced flight schedules and are carrying fewer passengers; hotels remain 20-25 percent below previous occupancy levels; and restaurants are laying off staff around the country. Because of this massive drop-off in travel and tourism sales, federal, state, and local tax revenues will be severely impacted, creating holes in these budgets that will lead to unforeseen cutbacks, particularly at the state and local level.

Other measures supported by TBR include:

	Extending added unemployment benefits and health care coverage to employees who have lost their jobs;
	Suspending payroll taxes for employees, and delaying payment of payroll taxes of employers;
	Expanding/amending the Small Business Administration’s Economic Injury Disaster Relief Program to otherwise qualified small businesses across the country.

Previously, TBR members met with Secretary of Commerce Don Evans, Minority Leader Richard Gephardt (D-MO), as well as Sam Farr (D-CA) Co-chair of the House Travel and Tourism Caucus.

In addition to the stimulus package, TBR’s meeting at the White House reaffirmed its call for the creation of a Presidential Advisory Council on Travel and Tourism that would be comprised of representatives from the public, private and non-profit sectors, and would work with the Executive Branch on tourism policymaking and implementation. The TBR also urged the federal government to partner with the travel and tourism industry to launch a substantive advertising and marketing campaign that promotes the United States as a travel destination.

The Travel Business Roundtable is a CEO-based organization representing all sectors of the travel and tourism industry, including major airlines, hotels and lodging, restaurants, retail outlets, travel management companies, car rental companies, financial services institutions and others. TBR’s roster includes 50 CEOs who reflect the interdependence of all sectors of the travel and tourism industry and demonstrates the need to work collaboratively. Additional information on the TBR can be found at www.tbr.org.

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Editor’s Note: Additional survey data can be found on TBR’s website at www.tbr.org

Media Contacts:
Jeffery Stewart - 212/521-2816
Debra Kelman - 212-794-DKPR (3577)

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