Time for tax overhaul: Sydney City

By: Jason Whittaker


People who cycle or catch public transport to work should get tax concessions, according to the City of Sydney Council. Sydney

People who cycle or catch public transport to work should get tax concessions, according to the City of Sydney Council.

Sydney Lord Mayor Clover Moore says the concessions should be delivered through concessional salary sacrifice or personal tax deductions of cycling equipment and monthly, quarterly and annual public transport tickets.

"Australia's current tax system actively encourages people to drive but does not reward those who make sustainable transport choices by cycling or catching public transport," Moore says.

Redesigning the tax system could create incentives for drivers to make the switch to more sustainable transport options, she says.

"People who contribute to reducing congestion and pollution and the burden on our health system should be rewarded.

"Someone earning a taxable income of up to $80,000 could get up to $315 back on the $1000 they pay for a bike, helmet and lock.

"Equally a commuter from Parramatta earning the same amount would get up to $630 back on their $2000 annual yellow travel pass."

Moore says the City wants a review of other incentives in the tax system, with Australia lagging behind other countries that have transformed their taxation system to actively promote public transport.

The United Kingdom's tax system calculates Fringe Benefits Tax based on the amount of carbon dioxide that a car emits, for instance.

In the United States, employers can provide their employees with tax free public transport vouchers, passes or fares.

"Fourty percent of peak hour traffic is corporately owned or subject to Fringe Benefits Tax concessions," Moore says.

"People are getting rewarded for racking up kilometres on their car. If we are serious about addressing climate change and fixing the transport system these imbalances need to be addressed."

The City made the recommendation to the Sydney Morning Herald's Independent Transport Inquiry.

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