Travel is big business for the US. Trump's policies are making it more costly and less appealing, just before the FIFA World Cup.

Business Insider

5 days ago

Major moneymakers for the travel industry are on the horizon, and with them, billions of dollars from overseas into the US.
But the potential windfall from those events could be at risk.
President Donald Trump 's policies — and the perception of his policies — could cause some international visitors to rethink travel to the US altogether. This is happening right before several major events that are expected to rake in tourism dollars, including the FIFA World Cup and America's 250th birthday next year, and the Summer Olympics in 2028.
"The overall picture right now is kind of a perfect storm," Lisa Simon, executive director of the International Inbound Travel Association, told Business Insider.
Trump's immigration policies and ICE crackdowns have some international visitors concerned that they aren't welcome in the US anymore. Meanwhile, changes passed in the Big Beautiful Bill, including an increase in visa fees and a funding cut for the organization that promotes tourism to the US, could lead to a further decline in international visitors.
Even without major events like the World Cup, tourism is big business in the US. Travel generated $1.3 trillion in spending in the US in 2024, according to a report from the US Travel Association, and supported 15 million jobs. It's also one of the US's largest service exports, drawing $181 billion in spending from international inbound travelers in 2024.
But the industry has already taken a hit under Trump. Simon said international travel to the US was down more than 6% year-to-date. Noting that foreign visitors typically book far in advance, she said the second half of the year and into next year look even worse, with some IITA members reporting booking declines as high as 40 to 60% in some markets.
While the US is still a top destination for international travelers, its market share has already been shrinking due to other destinations growing faster in popularity, she said.
The US's loss is also another country's gain, and Simon said destinations in Europe and Asia are already winning over travelers who are choosing to skip the US. China, for instance, has been opening up visa-free entry to more countries, drawing more visitors — and their money.
The White House did not respond to a request for comment.
The Big Beautiful Bill makes visiting the US more expensive for some
Erik Hansen, senior vice president, government relations, at the US Travel Association, told BI that surveys consistently show there are two primary factors that deter foreign visitors to the US: first, cost, and second, whether the US is a welcoming destination.
"For the One Big Beautiful Bill, it set us back in both areas," Hansen said.
The recently passed and signed spending bill adds to the cost barrier for foreign visitors. For travelers visiting from countries for which the US has waived visas, such as Australia, France, and South Korea, the fee for their travel authorization, or ESTA, was increased from $21 to $40. But for travelers from countries that require tourist visas, like China, Brazil, and India, a Visa Integrity fee of $250 was introduced. That fee is on top of the existing $185 tourist visa, making the new cost $435.
That means a family of four would be spending an additional $1,000 on fees before even entering the US. Hansen said that's $1,000 that's not being spent at American businesses.
The spending bill also cut match funding to Brand USA, the marketing organization that promotes travel to the US, from $100 million to $20 million. Hansen said Brand USA is "our megaphones for welcoming the world and encouraging people to come to the United States."
He said a lot of travel businesses and destinations also count on Brand USA to sell them to international markets, adding it's likely to be smaller and more rural destinations, many of which are represented by Republicans in Congress, to suffer the most from the funding cut.
An image and messaging issue
Simon and Hansen noted that, with the exception of countries affected by the travel ban, the Trump administration has not officially changed the rules for tourists visiting the US.
Still, stories of immigration crackdowns and international travelers having run-ins with ICE, or even being denied entry to the US on some occasions, have many international visitors feeling unwelcome. Several countries, including Germany, the United Kingdom, and Portugal, have even issued warnings or advisories to their citizens about visiting the US.
"I think the Trump administration's focus on illegal immigration has been misinterpreted by many people abroad as they don't want any foreign visitors here, but that's absolutely not the case," Hansen said.
The White House has established a World Cup task force with the goal of ensuring "a successful hosting of world-class international events that reflect the values, security, and hospitality of the United States of America."
Hansen said he has also spoken to cabinet officials who said they share the goal of making the US the best destination for international travel.
But there has been some less-than-friendly messaging, too.
"We want them to come, we want them to celebrate, we want them to watch the game," Vice President JD Vance said during the task force's first meeting in May. "But when the time is up, they'll have to go home. Otherwise, they'll have to talk to Secretary Noem."
The nod to Homeland Security Secretary Kristi Noem, one of the faces of Trump's deportation efforts, could be interpreted as not very welcoming.
"It's not that it's necessarily a totally negative message, it's just not the friendliest," Simon said, adding that the administration should focus on getting a welcoming message out.
In addition to pushing for a welcoming message, the US Travel Association is also appealing to the White House and Congress to restore Brand USA funding and cut the increased visa fees, Hansen said.
He added that making it more expensive to come to the US "doesn't make any sense" given the administration's stated goals of growing US exports and lessening trade deficits.
"That's a self-imposed tariff on one of our largest exports," he said.