(1) Consumer confidence and spending is crit-
ical to a healthy United States economy.
(2) In order to prevent a further decline in con-
sumer spending, which fell 1.8 percent in September
2001, and consumer confidence, which is at its low-
est level since February 1994, the Federal Govern-
ment needs to provide an immediate and targeted
tax incentive to encourage consumer spending.
(3) The most immediate and targeted incentive
for consumption would be to reduce the price of
goods to consumers, which can be done most effec-
tively by providing a tax incentive to individuals to
make retail purchases.
(4) A 10-day consumer travel tax credit holi-
day, prior to the 2001 holiday season, would encour-
age Americans to make immediate purchases and
help to counteract the decline in consumer con-
fidence Americans have experienced since September
11, 2001. The direct boost to consumption resulting
from such tax incentive would enhance the benefits
of individual tax cuts provided by any Federal tax
stimulus legislation.
(5) Alaska, Delaware, Montana, New Hamp-
shire, and Oregon currently do not impose a State
sales tax. These States have worked hard to estab-
lish a State tax structure that does not include a
sales tax. Any economic stimulus proposals relating
to sales tax must include proportional relief to these
five States, which have chosen not to impose a sales
tax. These five sales-tax-free States should not be
penalized for choosing the tax structure best for
their State by being excluded from sales tax holiday
relief. A tax credit for travel for the purpose of mak-
ing retail purchases in those States would provide a
benefit to consumers similar to a sales tax holiday
in other States.
SEC. 3. CREDIT FOR TRAVEL FOR PURPOSES OF RETAIL
PURCHASES IN STATES NOT IMPOSING SALES
TAX.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to nonrefundable personal credits) is
amended by inserting after section 25B the following new
section:
‘‘SEC. 25C. TRAVEL CREDIT.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount
equal to the qualified travel expenses which are paid or
incurred by the taxpayer during the consumer travel tax
credit period.
‘‘(b) QUALIFIED TRAVEL EXPENSES.—For purposes
of this section—
‘‘(1) IN GENERAL.—The term ‘qualified travel
expenses’ means reasonable expenses in connection
with a qualifying personal trip for—
‘‘(A) travel by aircraft, rail, watercraft, or
motor vehicle, and
‘‘(B) lodging while away from home at any
commercial lodging facility.
Such term does not include expenses for meals, en-
tertainment, amusement, or recreation.
‘‘(2) QUALIFYING PERSONAL TRIP.—
‘‘(A) IN GENERAL.—The term ‘qualifying
personal trip’ means travel within the United
States—
‘‘(i) the destination of which is Alas-
ka, Delaware, Montana, New Hampshire,
or Oregon, and
‘‘(ii) the purpose of which is to pur-
chase at retail tangible property of a type
that would be subject to sales tax in any
State not listed in clause (i).
‘‘(B) 
ONLY
PERSONAL
TRAVEL
IN-
CLUDED.—Such term shall not include travel if,
without regard to this section, any expenses in
connection with such travel are deductible in
connection with a trade or business or activity
for the production of income.
‘‘(3) COMMERCIAL
LODGING
FACILITY.—The
term ‘commercial lodging facility’ includes any hotel,
motel, resort, rooming house, or campground.
‘‘(c) DEFINITIONS.—For purposes of this section—
‘‘(1) CONSUMER
TRAVEL
TAX
CREDIT
PE-
RIOD.—For purposes of this section, the term ‘con-
sumer travel tax credit period’ means the period be-
ginning on December 7, 2001, and ending before
December 17, 2001.
‘‘(2) 
SALES
TAX.—The 
term 
‘sales 
tax’
means—
‘‘(A) a tax imposed on or measured by
general retail sales of taxable tangible property,
or services performed incidental to the sale of
taxable tangible property, that is—
‘‘(i) calculated as a percentage of the
price, gross receipts, or gross proceeds,
and
‘‘(ii) can or is required to be directly
collected by retail sellers from purchasers
of such property,
‘‘(B) a use tax, or
‘‘(C) the Illinois Retailers’ Occupation Tax,
as defined under the law of the State of Illinois,
but excludes any tax payable with respect to food
and beverages sold for immediate consumption on
the premises, beverages containing alcohol, and to-
bacco products.
‘‘(3) USE TAX.—The term ‘use tax’ means a
tax imposed on the storage, use, or other consump-
tion of tangible property that is not subject to sales
tax.
‘‘(d) SPECIAL RULES.—
‘‘(1) DENIAL OF CREDIT TO DEPENDENTS.—No
credit shall be allowed under this section to any indi-
vidual with respect to whom a deduction under sec-
tion 151 is allowable to another taxpayer for a tax-
able year beginning in the calendar year in which
such individual’s taxable year begins.
‘‘(2) EXPENSES MUST BE SUBSTANTIATED.—
No credit shall be allowed by subsection (a) unless
the taxpayer substantiates by adequate records or by
sufficient evidence corroborating the taxpayer’s own
statement the amount of the expenses described in
subsection (b)(1).
‘‘(e) DENIAL OF DOUBLE BENEFIT.—No deduction
shall be allowed under this chapter for any expense for
which credit is allowed under this section.’’.
(b) CONFORMING AMENDMENT.—The table of sec-
tions for subpart A of part IV of subchapter A of chapter
1 of the Internal Revenue Code of 1986 is amended by
inserting before the item relating to section 26 the fol-
lowing new item:
‘‘Sec. 25C. Travel credit.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after the
date of the enactment of this Act.
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