Today, Ottawa unveiled a expected tax credit for people who buy monthly or annual passes. Although this will not put more money in the pockets of transit agencies, it will substantally change the break-even point for people who buy passes.
Without the tax credit, a monthly pass costs $99.75, equivalent to 47.5 fares.
On the Monthly Discount Plan, a pass costs $91.50 per month, equivalent to 43.6 fares.
The new tax deduction, at 15.25% reduces these multiples to about 40 and 37 respectively. This is an important psychological breakthrough when the cost of using a pass falls below the perceived cost of a regular, daily commute.
The TTC needs to proceed on two fronts:
First, a revamped Metropass Discount Program campaign to swing even more riders over to the pass market which has already seen the benefit of a transferrable pass.
Second, a thorough review of service implications especially in the off peak. We can reasonably expect that most of the marginal growth through shifting riders to passes is in trips they might not have taken otherwise and to pass sharing.
The City of Toronto has to get serious about funding growth in transit services in any time period where vehicles are available to do so.