Foreign Relations of the United States, 1964–1968, Volume VIII, International Monetary and Trade Policy

30. Memorandum From the Acting Director of the U.S. Travel Service (Black) to Secretary of Commerce Connor¹

Washington, January 21, 1965.

SUBJECT

• U.S. Travel Service—Priority Items

There are only two matters affecting USTS which require your immediate attention:

1. Proposed Travel Tax. We discussed this briefly at Tuesday’s staff meeting.² In summary, Treasury has proposed the imposition of a $100 tax per person on travel abroad by U.S. citizens as a means of cutting down our balance-of-payments losses in the travel sector. This has been considered at the Cabinet level and a final decision should be made within the next week or so. If approved, this tax would be announced in a special balance-of-payments message to Congress by the President early next month. Assistant Secretary Holton has the action on this problem and can give you more details.

USTS is strongly opposed to the tax on outbound travel, as we believe it would have repercussions on our own program to attract more foreign visitors here. We think the timing is bad, inasmuch as our “travel deficit” has not increased during the past year. However, if savings on our travel account are required, we propose instead that the duty-free allowance for returning U.S. residents be cut and that the Government officially promote the use of U.S.-flag carriers by U.S. citizens. These measures, we believe, would effect the savings required by Treasury and would be far more acceptable politically here at home.

I have discussed this problem in detail with Under Secretary Roosevelt, and he has a memo from us outlining our position at length.³

2. Travel Advisory Committee. At our staff meeting, you mentioned the need for close consultation with industry in shaping the Commerce Department’s policies. In the travel field we have a formal advisory group—the Travel Advisory Committee—composed of 36 representatives of carriers, hotels, travel agents and other business interests concerned with international travel. The Committee meets quarterly in Washington, and our first meeting of this year should be held early next month, if possible.

I would like to set a meeting date rather soon—but would like to fix a day when you could join with us and at least say “hello” to the group. Secretary Hodges customarily attended at least the first meeting of the TAC every year.

Attached is the press release listing the TAC members, including those newly appointed.⁴

1. Source: Washington National Records Center, RG 40, Records of the Office of Fred Simpich, Assistant to Secretary of Commerce, 1965–1968: FRC 70 A 7017, Secretary’s Staff Meetings, 1965. No classification marking.
2. The minutes of the Secretary of Commerce’s staff meeting on Tuesday, January 19, refer only briefly to the Tourist Tax. (Ibid.)
3. Not further identified.
4. This Department of Commerce press release, G 65–7, January 15, is not printed. Secretary Connor announced the appointment of 36 members to the 1965 Travel Advisory Committee, of whom 16 were members of the 1964 Travel Advisory Committee. All members served without compensation for a 1 or 2-year term.