Thursday, May 1, 2003 | 11:22 a.m.
WASHINGTON -- Several tourism industry officials renewed their quest to spur Congress to increase the business meal tax deduction on Wednesday.
"Now more than ever this would provide an immediate incentive for small businesses and corporations to authorize their personnel to start traveling again," Michael Sternberg, a Washington restauranteur, told a congressional panel, speaking on behalf of the National Restaurant Association.
The request was just one on a wish list that travel representatives brought to lawmakers during a hearing on the grim state of the nation's tourism industry.
Witnesses and lawmakers on the House subcommittee on commerce, trade and consumer protection discussed a "perfect storm" of factors that are bleeding the industry.
The weak economy, the war with Iraq, fears of terrorism, hassles with airline travel and new anxieties over severe acute respiratory syndrome have created the worst travel and tourism climate in recent memory, a prominent hotel official said.
"I personally have not seen a spiral of this nature," said William Edwards, of the American Hotel & Lodging Association and a Washington-area vice president for Hilton Hotels.
The hearing was held to spotlight the importance of the industry to the national economy. Tourism is among the top three industries in 29 states, directly or indirectly employees 18 million people and generates $500 billion annually, said subcommittee chairman Rep. Cliff Stearns, R-Fla.
The tourism industry's trade balance with other nations is steadily declining -- it dropped 70 percent from $26 billion in 1996 to $8.6 billion in 2001, Stearns said.
The trend is reflected in Las Vegas, where 12 percent of visitors were from other nations in 2001, compared to 8 percent last year, according to the Las Vegas Convention and Visitors Authority.
"The United States is now the third most visited travel destination in the world, behind France and Spain," Stearns said. "There is no reason why it cannot be the first."
As one fix, Stearns said he planned to push legislation this year to create a Presidential Council on Travel and Tourism, which would advise the Commerce Secretary and the president on tourism policy.
Congress has already tried to help the industry, most recently approving about $3 billion in aid to airlines as part of the $79 billion Iraq war bill. Stearns also highlighted the $50 million lawmakers approved last month for an advertising campaign to run in foreign nations, encouraging international travelers to come to the United States.
A panel of seven tourism industry officials thanked Congress for that, but brought some recommendations of their own:
"The hospitality industry is the largest employer of welfare-to-work program participants, the largest employer of single parents, the largest employer of immigrants," Walker said.
"Profits industry-wide are not expected until at least 2005," May said.
"We are less concerned about the specifics of the bill than about its impact," Edwards said. "We urge Congress to approve a substantial measure that will achieve significant economic growth."
As for the proposal to allow business travelers to deduct the entire cost of meals and entertainment from their taxes -- instead of the current 50 percent -- the outlook in Congress is unclear. Republican leaders have said the meal tax has not been part of the broader tax-cut debate.
Nevada lawmakers and other officials back the full meal-tax deduction. At a travel conference in Washington earlier this month, Culinary Union President John Wilhelm said restoring the full meal-tax deduction "would do more for our economy than the repeal of the taxation of dividends."
The Associated Press
contributed to this article.
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