A story in today's New York Times (Mixed Signals: Driving to Work as a Tax Break, William Neuman, August 16, 2007) shares that on the one hand while the U.S.DOT is giving out grants to get people out of their cars, on the other hand the IRS is giving tax breaks to help people pay for the cost parking when they drive to work. And people are just catching on to this discrepancy? Us TDM people have been screaming about this mixed signal for years.
The federal tax code allows commuters to use up to $215 a month in pre-tax wages to pay for their parking at work or employers can provide up to $215 a month in a tax-free (to the employer and the employee) benefit. The transit/vanpool benefit is $110. From the article:
"It is perverse," said Jeffrey M. Zupan, a senior fellow for transportation at the Regional Plan Association in New York. "If you're going to institute pricing measures (referring to Mayor Bloomberg's congestion pricing plan) that are intended to reduce the amount of driving, you don't want to keep in place other measures that encourage people to drive. What you want is a set of policies that work together... You're almost exactly counteracting one federal policy with another. We really shouldn't be doing that."
Agreed! And we get excited about the potential for $20 a month for bike commuting (House Passes Energy Bill, Includes Bike Commuters (August 14, 2007). The same thing is apparent in our own region where people are talking about congestion pricing, HOT lanes and other ideas to help battle traffic congestion. All of this is countered by a federal policy that favors driving and parking with tax breaks. Its time the tax break for parking for SOV drivers is ended.
Chris Hamilton is the Commuter Services Chief for Arlington County, manager of CommuterPageBlog and a biking/Metro commuter from Rosemont in Alexandria.