Pressure is mounting for Congress to reverse cuts to commuter benefits as part of a major tax package this year.
Public agencies, businesses and lawmakers are hoping a provision that allows public transit riders to put away more pre-tax money for commuting costs will be attached to legislation on the payroll tax cut, which is set to expire on Feb. 29.
From a policy perspective, no one in Congress is going to refute the environmental and economic benefits of using public transportation or carpooling. In 2009, congestion cost Americans about 3.9 billion gallons of fuel, 4.8 billion hours stuck in traffic, and $115 billion in lost income, according to “Commuter Benefits Work For Us,” a white paper published by the coalition.
Employers benefit from the transit tax break because they don't pay payroll taxes on pre-tax deductions made by employees. “Beyond the personal savings realized with transit benefits, the accounts saved employers more than $300 million in payroll taxes in 2010,” wrote WageWorks CEO Joe Jackson in a late 2011 blog for The Hill.