Tax-Free Transit Benefits In
17 December 2007
By Todd Litman
Victoria Transport Policy Institute
I have long been a supporter of employer-based incentives for public transit (often called “tax-free transit benefit” or “tax-free transit passes”). This is one of the "Win-Win Transportation Solutions" (http://www.vtpi.org/winwin.pdf), which are market-based reforms that provide multiple economic, social and environmental benefits.
There is now a promising opportunity to have this policy established in
Research by myself and others indicates that transit benefits significantly increase transit ridership and provide large net benefits (see www.vtpi.org/tdm/tdm8.htm ). Federal government sponsored research indicates that this policy is very cost effective overall (IBI, 1999, Tax Exempt Status For Employer-Provided Transit Benefits, Transportation Issue Table, National Climate Change Process and Transport Canada (www.tc.gc.ca/programs/environment/climatechange/subgroups1/passenger_urban/study5/exec_summary/english/transitpass.htm ). In fact, it ranked as the most cost-effective transport emission reduction strategy of dozens evaluated (Transportation Climate Change Table, 1999, Transportation and Climate Change: Options for Action, Transport Canada).
US experience summarized in a National Academy of Science study (Analyzing the Effectiveness of Commuter Benefit Programs, TCRP Report 107, http://onlinepubs.trb.org/onlinepubs/tcrp/tcrp_rpt_107.pdf ) reported that transit benefits typically cause transit use to increase by approximately 25%, and sometimes by 100% or more. Tax-free transit benefits began in the
There is a very good possibility that the 2008 Budget will include this measure, if we can continue to demonstrate broad public support. In response to a request from the House of Common’s Finance Committee, which received written testimony on this topic in August, oral testimony was provided earlier this month. Interest is strong within the Government as well as with MP’s. The Canadian Urban Transport Association (CUTA) is lobbying for it (www.newswire.ca/en/releases/archive/November2007/27/c4789.html ), as is Al Cormier, a former CUTA CEO, and Richard Oram, founder of Commuter Check (www.commutercheck.com).
WHAT YOU CAN DO
Please send letters to the Finance Minister, The Honourable Jim Flaherty, and to the Minister of Transport, the Honourable Lawrence Cannon, asking them to implement this policy change. A template is posted at www.vtpi.org/TT_letter.doc (MS Word format) or www.vtpi.org/TT_letter.htm (HTM format). Sending letters on your organization's letterhead is especially valuable. You can simply print the letter as is and sign and mail one to each Minister, or make modifications to reflect your own knowledge and feelings about this issue, who your organization represents, etc. Personalizing will make it even more effective.
Please note -- it is very important that Al Cormier receive a copy of your letter(s), so that we can be sure all appropriate government officials see them. Thus, please forward your letters to Al Cormier by fax to 905-858-9291 or by e-mail to firstname.lastname@example.org . If your letterhead will not appear electronically, please use fax.
Please contact me (250-360-1560 or email@example.com), or Richard Oram (201-280-8444 or Richard@enviro-urban.org) if you have any questions or comments. Thank you!
Todd Alexander Litman
Victoria Transport Policy Institute (www.vtpi.org)
Phone & Fax
1250 Rudlin Street
“Efficiency - Equity - Clarity”