Lord Mayor Clover Moore calls for public transport tax breaks

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10 Nov 09 @ 10:00am by Robert Burton-Bradley

Tax breaks for public transport: Clover Moore. Photo: Alan Place

Sydney Council is demanding the Federal Government introduce tax concessions for people who catch public transport or ride a bike to work.

The council has suggested this be done through concessional salary sacrifice, or personal tax deductions on cycling equipment and monthly, quarterly and annual public transport tickets.

“Australia’s current tax system actively encourages people to drive but does not reward those who make sustainable transport choices by cycling or catching public transport,” Sydney Lord Mayor Clover Moore said.

According to the Bureau of Transport Economics, traffic congestion costs Sydney close to $4 billion a year, and this is expected to rise to $8 billion by 2020 unless action is taken.

The health and environmental costs of transport are estimated to cost $1.4 billion a year.

“People who contribute to reducing congestion and pollution and the burden on our health system should be rewarded,” Cr Moore said.

The council has argued that creating incentives for drivers would encourage them to change to more sustainable transport options.

The council is also seeking a review of other incentives in the tax system, arguing that Australia is lagging behind other countries that have transformed their taxation system to actively promote public transport.

The United Kingdom’s tax system calculates Fringe Benefits Tax based on the amount of carbon dioxide that a car emits.

In the United States, employers can provide their staff with tax free public transport vouchers, passes or fares.

“Forty per cent of peak hour traffic is corporately owned or subject to Fringe Benefits Tax concessions,” Cr Moore said. “People are getting rewarded for racking up kilometres on their car.

“If we are serious about addressing climate change and fixing the transport system these imbalances need to be addressed.”

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Good on you, Lord Mayor Clover Moore - but if we are really serious: why not make it so much easier and provide a real incentive for people to switch to public transport: make it fare-free for all! [Ed]