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Rail News Home Federal Legislation & Regulation

1/5/2012



Rail News: Federal Legislation & Regulation

APTA: Congressional inaction on commuter benefits amounts to $550 tax increase for transit riders


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The American Public Transportation Association (APTA) is calling on Congress to correct a “bias that favors driving over taking public transit” by restoring the commuter transit tax benefit, APTA officials said in a prepared statement.

Congress recently recessed for the holiday break without renewing federal legislation that impacted the amount of pre-tax dollars transit riders were allowed to set aside to pay for public transportation costs. The pre-tax transit benefit, which expired Dec. 31, temporarily established parity between parking and transit/vanpool benefits at $230 per month per commuter.

“At a time when Congress and the [Obama] administration have resisted revisiting gasoline taxes to support much-needed investments in our nation’s transportation infrastructure, it is ironic that they are willing to effectively raise taxes on public transit users,” said APTA President and Chief Executive Officer Michael Melaniphy.

On Jan. 1, the transit benefit dropped to $125 per person, while the parking benefit increased to $240 per person per month. As a result, commuters who use public transit or vanpools may see their annual commuting costs increase by more than $550, APTA officials said.

The change in benefits also may impact the tax liabilities of employers that offer a transit program as part of their pre-tax benefits plans, said APTA officials.

Melaniphy encouraged transit riders to tell their congressional representatives to support the commuter transit benefit when Congress resumes negotiations to finalize the middle-class payroll tax cut before it expires at the end of February.

For the long term, transit riders should encourage Congress to support legislation by Rep. Jim McGovern’s (D-Mass.) in the House and Sen. Charles Schumer (D-N.Y.) in the Senate that would permanently extend the parity for the commuter benefit, APTA officials said.