A new report from TransitCenter, a foundation that says it “works to improve urban mobility,” calculates that the parking benefit is worth up to $1,000 a year for commuters who are in high tax brackets and work in big cities. Collectively, it calculates, the break costs $7.3 billion a year in lost tax revenue.
True, there’s also a tax benefit for mass-transit commuters that costs the government about $1.3 billion a year. TransitCenter says that while it’s good as far as it goes, “it is overshadowed by the parking tax benefit’s much larger adverse impact.”
If you work in a place where there’s lots of free parking in lots or on the street you don’t benefit from the tax break. That’s because in such places the employee parking lot isn’t an economically valuable fringe benefit; you could have parked for free even if it didn’t exist. The break is only valuable for people who work in crowded areas. So two-thirds of American workers are in effect transferring money to the other one-third.