From Rodney in Denver:
I’ve been thinking of ways to get more people to use mass transit. I thought making transit passes tax deductible would be a good idea… I’m curious what your thoughts are on this idea?
Well Rodney, having just finished my own taxes, I think it’s a pretty darn good one. There’s a deduction for people who buy hybrids; there’s mileage credit for folks who drive for business purposes; there’s even a sales tax deduction for major purchases (like cars and boats). Why no love for transit types?
I think the trick is in the implementation. A deduction for buying a transit pass wouldn’t be very substantial (given that the cost of passes isn’t very substantial) and therefore wouldn’t provide much of an incentive to buy one. If the deduction was much more than the cost of the pass (in other words, closer to the social benefit of driving less), we’d have to require folks to prove that they actually rode.
Soon, most transit systems will have the technology to measure actual transit usage, and we’ll be able to reward (through tax breaks and other fabulous prizes) frequent riders. Until then, I’ll take the transit-pass deduction. And the free food at transit fests.