Ballard discusses commuter tax concept

Mayor Greg Ballard (WISH Photo)

INDIANAPOLIS (WISH) – A mass transit proposal is heading to the Indiana House.

A committee approved it Wednesday, but without a corporate tax to help fund a better Indianapolis bus system.  Instead, the improvements would have to come from higher local income taxes and higher bus fares — if voters approve a referendum.

Mayor Greg Ballard spoke in favor of that tax, Wednesday.

And, when 24-Hour News 8 sat down with him on Tuesday, he welcomed discussion of another tax idea.  A commuter tax.

“We have 200,000 people move in to the city every day to go to work,” he said.  “Love to have ’em.  Not much question about it.”

But, he said their presence puts a demand on the City of Indianapolis.

“They’re using up a lot of services that we can’t pay for, right?”

Wear and tear on the roads is the most obvious example.

Ballard said the 200,000 commuters are comparable to the state’s third largest city moving to and from Indianapolis every day.  A commuter tax would be a fee on the earnings of people who earn their money in Marion County and go home in the surrounding counties.

In Carmel, Mayor Jim Brainard is a skeptic. He says companies would have to raise salaries to help their commuting employees pay the new tax.

“It’s going to encourage employers to move out of Marion County, if Marion County is the only county that institutes a tax like that,” he said.

Ballard said it may not work that way. And, because this is an era of tight budgets, he said the concept deserves consideration.

“There are different ways of doing things and Indianapolis will be able to figure this out,” he said.

Matt Yglesias, a writer for Slate studied commuter taxes in 2010. He said one alternative might be taxes on parking garages. He also said cities might target sales taxes in areas most likely to attract commuters. The idea being, he said, to put higher taxes on the things commuters use.  And lower taxes where commuters don’t go.

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