Season Ticket Tax Break Call
7 October 2013, 11:14
Boris Johnson's in talks with the Chancellor to try and get a tax break for commuters facing rail fare rises.
The London Mayor's called for commuters to be able to buy their season tickets using pre-tax income, potentially saving individuals hundreds of pounds a year.
Labour have challenged the Mayor to freeze fares in London in 2014, accusing him of an "abysmal record" of annual hikes that make London travel the most expensive in the world.
An annual zone one-to-six annual travelcard increased by £440 to £2,224 in the five years since he was elected to City Hall, the party say.
Mr Johnson said it would be "irresponsible" not to raise fare income sufficiently to pay for the modernisation of London's ageing underground network and cope with a fast-rising population.
But a tax relief would target workers' travel costs, he wrote in the Daily Telegraph, while a "hopelessly blunt" fare freeze would benefit tourists and casual passengers who did not "need or deserve" help.
Mr Johnson - who has written to the Chancellor setting out his proposal and discussed it with him - believes there is a "compelling case" for it to be applied across the country, aides said.
They said it had been costed but were unable to give figures.
"If you have to use public transport morning and night, then you know that it can take a huge slice of your income," Mr Johnson wrote.
"Every autumn we face the same dilemma. If we follow the pleas of our officials, and raise fares - to cope with inflation and the cost of investing in our systems - then we are tightening the squeeze on people who have already seen their disposable income shrink over the last five years.
"If we are irresponsible, on the other hand, and we fail to replenish the 'fare box', then we risk disaster."
Mr Johnson said 40% of passengers travelled for nothing - and that there would be mayhem if any attempt was made to strip the "affluent bourgeoisie" of old-age bus passes.
"The result is that the entire burden of fare-paying is carried by the 60% - and that includes the people who make this country work, the people on low or moderate incomes who travel large distances every day and who to their places of employment and who have absolutely no choice in the matter.
"It is time we did something specifically to help them, and that something is to give tax relief on travel."
"Employees should be allowed to pay for their season tickets from their pre-tax income."
A commuter buying a £784 annual bus pass would save £251 in tax and National Insurance, and their employer would save £108.
"Yes, there would be a cost to the Treasury - but then every year government spends huge sums trying to hold fares down.
"This scheme strikes me as one George should consider further. You would allow continued investment in transport, and you would target your help at exactly the people who need it - not the millionaires and the tourists and the casual shoppers, but the hardworking people who are really turning the wheels of recovery."