Michael Lewyn describes an interesting idea for increasing transit ridership – creating a tax incentive.
“So why not a tax cut for transit? Specifically, I propose the following: a $1000 per year tax credit for weekly and monthly transit passes. Transit agencies in need of revenue could raise the cost of transit passes, and could inform riders that they would be able to get the money back when they paid their taxes. As a result, more people would buy transit passes, and transit agencies would no longer be drowning in red ink.
In addition, a transit policy based on tax credits rather than subsidy increases would empower consumers rather than empowering bureaucrats. One common argument against subsidizing operating expenses is that federal subsidies are wasted by bureaucrats, and thus never really benefit transit riders. By contrast, under a tax credit plan, a transit agency’s interests would be aligned with those of riders: the agencies most able to appeal to riders would get the most funding, while less competent transit agencies would get less.”
