The IRS defines it as follows :
“The IRS is committed to helping you get your Economic Impact Payment as soon as possible. The payments, also referred to by some as stimulus payments, are automatic for most taxpayers. No further action is needed by taxpayers who filed tax returns in 2018 and 2019 and most seniors and retirees.”
The IRS got it very wrong it seems like, starting with the name, the definition, and the purpose. We’ll explain why, are you ready ? brace for ‘ECONOMIC’ impact !
While more than half of the planet’s population is confined facing the uncertain. Some cities and states are looking into the situation from a different perspective. The city of Miami for instance is one of those cities. Since we are travel & tours providers in Miami and South Florida; we share the same concerns, anxieties, and aspirations, and let me tell you why ! Well, simply because Miami thrives on tourism.
Tourism is simply the backbone of our local economy. In 2018, an estimate of 23 million visitors injected $18 Billion Dollars into Miami’s reserves ! Yes, your heard it right ! $18 Billion dollars in one year. In other words, we made as much revenue out of one sector (tourism) in a single city (Miami) as many other ‘COUNTRIES’ whose economies are way more complex and holistic than that of Miami.
For instance, about 92 countries around the world have a smaller GDP than $18 Billion, go figure ! So to hear some governors, politicians calling for reopening the economy is both exciting and alarming at the same time. Alarming for all the health reasons that we all know about but exciting for a lot of businesses on which Miami thrives.
Let’s keep it real ! Miami thrives on tourism and that is a fact, but a big chunk of it comes from international visitors and mainly from countries such as Brazil, Argentina and Columbia that rank up as top source markets, but also who are struggling to tackle the outbreak of the pandemic with Brazil being a major concern. As most of these countries are heavily involved in a global fight against the virus, travel businesses in Miami should NOT expect a rapid bounce of the economy as soon we open our borders. This is not just me saying this, Governor Distantis and President Trump held a press conference today (4/28/2020) about the whereabouts of reopening Florida’s Economy (which means reopening Florida to International visitors who injected the $18B remember 😉 ?!). While Gov. Desantis sounds a bit confident in Florida’s ability to reopen the economy, both the Governor and the president asserted that more preliminary measures must be taken by Latin American countries in order to monitor their outbound travelers. President trump even pointed out at a possible closure of our borders with Latin America amid the outbreak. Long story short, DON’T BE TOO EXCITED dear Florida Travel business owner. In the event, the economy is reopened, your best bet is to rely on inbound tourism, homemade tourism, local travelers, you name it; as long as it comes from mainland U.S.A.
Just about a month ago, we mentioned in an article that we are facing the unknown. Data has changed now, however. Experts economists are starting to chip in their fair share of speculations by suggesting a rather slower recovery that could possibly take a year or two. These speculations are, of course, in direct correlation with the advent of medical research leading to a possible cure or vaccine. Our fate is not in our hands ! You must have had some hints if you were a Wall Street stocks enthusiast. On top of a slower recovery, other variables will also weigh in on how the tourism and travel sector will be handled moving forward. One thing for sure, things will not be the same for a quite some time. So, Brace for Impact !
Now that we’re done with our reality check, let us put you in the picture once more before we move on. Here’s how Lincoln Road in Miami beach looked during high season and here is a live cam of how it looks now.
Scaaary, isn’t it ?
To slightly minimize the Covid-19 struggle, the government has introduced a $2 Trillion package that Americans with a social security number received (or are still receiving) or what everyone names ‘Stimulus Checks’. So, without further due, we know that there’s money out there waiting to be spent somehow. The question is, how much of that money could be spent on hospitality, travel and tourism services ? To answer this question, Business Insider and CNBC reported some surveys being done by data collectors which suggest that most of the money is being spent on food and groceries (shoutout for our restaurant business owners !). According to Business Insider :
“31% of respondents in Cowen’s survey indicated they would put stimulus checks towards savings” while data also showed that 20% of the survey respondents are spending their money on non-conventional items such as guns, video games, etc. It is very hard to generalize the survey results on all Americans (for statistical reasons) but we can presume that roughly 50% of the package (savings +_non conventional) COULD POSSIBLY be spent on travel and hospitality packages.
That explains why a lot of big corporations are spending heavily on marketing during these times. From a small business perspective, it would not really hurt to consider putting in a budget for marketing campaigns, social media content and investing in a viable website. People are spending most of their times online anyway, so that is the place to be !
If you happen to be one of those non-stop travel enthusiasts, we are quite sure you can’t wait for the pandemic to end, but we know for sure that you can’t wait to sit your ‘butt’ on aisle seat bound to your next ‘VACAY’ destination either. Well, David (owner of French VIP Service) put in place some packages that could be of interest to you, your friends or family. We took the budget into accounts, so we kept the costs below stimulus checks level (we are assuming you’re part of those 50% saving your check or just using it for fun). You will be surprised of what you can do with a $1 200 (or more if you’re lucky enough to have an immediate family). As the name suggests, French VIP Service will get you the best packages in Miami and South Florida at highly competitive rates. We are trusted by Expedia, Trip Advisor, Viator and more !
Written by our tourism professional Marcelo O. for French VIP Service
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