Daily Management Review

Tax Relief For Firms Hit By Coronavuris In Airlines, Travel Industry Mulled By The US


Tax Relief For Firms Hit By Coronavuris In Airlines, Travel Industry Mulled By The US
United States based companies in the airline, cruise and travel industries that have been hit by the coronavirus outbreak could be given a tax relief by the Trump administration to help them to cope with the virus hit as the outbreak has hit revenues by a sudden and huge drop in bookings, said reported in the US quoting sources familiar with matter.
This measure which could include a proposal for tax deferrals is a part of a slew of measures the tah US is contemplating taking for industries that have been hit by the coronavirus outbreak and to limit the economic damage that the outbreak can cause. It is estimated that the outbreak could result in a suppression of consumer spending and many workers choosing to stay back at home instead of going to work.
The actual magnitude of the economic fall out of the slowdown because of the global virus outbreak is too early to determine, said White House Economic adviser Larry Kudlow, who added that the overall economy of the United States was still fundamentally strong and that the country had no threat of slipping into a recession.
Strong February payrolls data was released by the US Labor department which reflected the results of the surveys that were conducted before the spread of the virus outside of China.
One of the major concerns for the US authorities is about those people who might have to stay back at home because of the outbreak and thereby not get wages. There are also concerns about small business and airlines, Kudlow told reporters at the White House.
"We're worried about small business. We might be worried about small farms. We might be worried about some sectors of the economy that are really hard hit," Kudlow said. "There are a lot of things we can do for cash flow purposes, possibly deferred tax purposes, and we can set up mechanisms to do that," Kudlow said and added that they would be "micro-forms of assistance."
The specific industries that could get the tax deferments were not named by Kudlow. No comment was available on this from the Y+US treasury department as well. This move by the US administration was first reported by the Washington Post.
The US Congress might be needed to be approached by the US administration to seek additional funding Kudlow said but confirmed that the aid would be "targeted micro-forms of assistance."
"We are at the moment are not going to do these gigantic packages where we put in helicopter money for everyone," he added.
An emergency half-percentage point rate cut was announced earlier this week by the United States Federal Reserve in its efforts to try to combat the impact of the coronavirus outbreak.
With the spread of the coornavirus outside of China at a fast pace spooked investors about the economic fall out of the outbreak globally with resulted in fall in the global stock markets over the last couple of weeks. The total number of people infected so far by the virus has crossed 100,000 globally. A total of 15 death so far have been reported in the United States because of the virus infection.