Congressional inaction is leading to a $561 hike in the taxes of transit riders, charges the American Public Transit Association.
The group said failure to extend tax benefits to transit riders along with drivers is creating an incentive for commuters to drive to work, rather than take transit.
Last year, drivers and transit riders could deduct up to $230 a month in pre-tax dollars to pay for commuting expenses. But in the end-of-year frenzy, Congress failed to extend the deduction for transit riders.
Congressional leaders have not offered explanation for failing to extend the benefit.
The American Public Transit Association said it will cost the average transit commuter about $561 in higher taxes.
APTA spokesman Mantill Williams said the loss of the tax benefit will hurt suburban riders the most, meaning riders of the LIRR, NJ
Transit, or Metro North are hardest hit because they spend the most on transit. Suburban riders also tend to be the most likely to make choices between transit and driving.
"You want to provide incentives for people to take transit,” Williams said, “because transit benefits even people who don't take transit because it takes cars off the road, so you want to give people that financial incentive, or a least make it equal.”
According to APTA's calculations, that figure holds for a company with employees in the 28 percent tax bracket, with a state tax rate at 5 percent and FICA and Medicare at 7.65 percent.
APTA is lobbying Congress to reinstate the benefit retroactively in legislation extending the payroll tax deduction until the end of the year.