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Senate Tax Proposal eliminates Bike Commuter Benefit – Keeps other Commuter Benefits
Yesterday the Senate Budget Committee approved the Senate Tax Proposal that eliminates the Bike Commuter Benefit. This means that the bill advances to the Senate floor for a vote by the full chamber.
This leaves two chances to save the Bike Commuter Benefit:
- Amend the current Senate tax proposal so that it no longer eliminates the Bike Commuter Benefit, or
- Ensure that when the Senate and House tax proposals are reconciled in a conference committee that the final bill does not eliminate the Bike Commuter Benefit (the House tax proposal does not currently eliminate the Bike Commuter Benefit).
The Bike Commuter Benefit allows employers to reimburse employees up to $20 per month tax-free for qualified bike commuting expenses when an employee regularly uses a bicycle to commute to work. The Joint Committee on Taxation estimates that the Bike Commuter Benefit costs the federal government $5 million per year in lost tax revenue, or .003% of the nearly $1.5 trillion budget deficit that the current tax proposals are expected to create in the next ten years.
The current tax proposals keep existing parking and transit commuter benefits that cost a combined $8.6 billion per year, with 85% of that costs being due to the parking commuter benefit. In many states, the federal government spends more to subsidize parking in large cities than it does on all biking and walking infrastructure in the state. For instance, the cost to the federal government of subsidizing parking in Downtown and Midtown Manhattan is $134.3 million per year; nearly three times the $46.1 million per year spent by the federal government on biking and walking infrastructure in all of New York State.
To learn more about the Bike Commuter Benefit, other existing commuter benefits and what is at stake in the current tax proposals, please see this short presentation.