The Conservatives� tax credit for public transit
By Ira Basen, CBC.ca Reality Check Team | Dec. 30, 2005 | More Reality Check
If the Conservatives are elected, regular riders of public transit would get an average of $153 back from the federal government by claiming a 16% tax credit against the cost of their transit pass. The plan will cost the federal government $400 million a year.
Harper�s proposal is central to his strategy to cut greenhouse gas emissions. The Conservatives are not great fans of the Kyoto accord, and have talked for years about developing a "made-in-Canada" solution to the problem of global warming. In making his announcement, Harper proclaimed the 16% tax credit would be good for the environment.
"Our tax credit for transit users will put hard-earned dollars back in the pockets of Canadians, and at the same time help our environment. This will be a real incentive that encourages more people to take public transit which, in turn, means fewer cars on the roads and cleaner air."
The Conservatives are offering a welcome reward for current public transit users, but they are clearly not the main targets of the plan. If greenhouse gas emissions are to be lowered, people currently driving their cars to work will have to be enticed to climb out of their vehicles and onto the buses. Will Harper�s money be enough to do that? Not likely!
Let�s look at the numbers...
There is already a substantial gap in the cost of commuting to work by car versus public transit. According to the Toronto-based consulting firm Runzheimer International, it costs about $11,000 a year to own and operate a car in Toronto. How much of that is spent on the daily commute? That depends on a number of factors, but with gas at roughly 90 cents a litre, and parking downtown about $10 a day, in addition to the wear and tear on the vehicle, you have to figure that driving to work every day eats up a considerable portion of that $11,000. Meanwhile, an unlimited pass on the Toronto Transit Commission costs $1,086 a year. The Conservative plan will return $190 to the pocket of the TTC user.
Two questions have to be asked:
- Toronto transit riders are already saving thousands of dollars by leaving their cars at home. For those who continue to drive, money does not appear to be the deciding factor. Would an extra $190 really tip the scales?
- Would you not have a better chance of attracting new riders by using that $400 million to add more buses and trains and generally make public transit a more attractive option?