OC Transpo riders who've come to enjoy a small perk at tax time are in for some disappointment.
The federal Liberal government is scrapping the non-refundable public transit tax credit, first introduced by the Conservatives in 2006.
The credit allowed riders to claim up to 15 per cent of what they spent on transit passes. For an adult OC Transpo pass holder, the credit translated into a $200 saving come tax time.
The tax credit will be eliminated July 1, saving the federal government an estimated $200 million.
'I'm going to have to scrimp and save'
Transit riders in downtown Ottawa hearing the news for the first time Thursday morning were not impressed.
"Wow. I didn't realize that. That's not great," said Jenn Viau.
Viau said the tax credit made it more economical for her to buy a monthly pass, even if her ridership habits didn't always justify it.
"It'll change the way I buy my bus passes," said Viau. "I'll end up just putting money on [a Presto card] every month, instead of putting a bus pass on it."
Joan Garrad said the elimination of the credit will be a financial burden.
"It's unbelievable! They actually are taking something away from the poor," said Garrard. "I still have to use [public transit], but it means I'm going to have to scrimp and save."
Credit didn't boost ridership, government maintains
In releasing its budget Wednesday, the federal government insisted the public transit tax credit was ineffective in encouraging Canadians to take public transit.
That's not how Ottawa mayor Jim Watson saw it, however.
"I think that was a good incentive for people to buy a transit pass," said Watson following the budget speech. "I know [the federal government is] getting out of those so-called boutique tax credits, but that was one I would have hoped they kept."
In an appearance at Algonquin College Thursday, Finance Minister Bill Morneau told staff and students the decision came down to using public funds as "effectively" as possible.
"Governing means making choices," he said. "It means making choices that you think are right for the long run."
The government's investments in improving public transit systems will do more to increase ridership.
As he waited for his bus Thursday morning at the corner of Bank and Slater streets, Hartley Holder agreed.
"I think what will probably encourage people to use transit more is a better system — cleaner, more efficient, that sort of thing," said Holder.
In that spirit, the federal minister of infrastructure, Amarjeet Sohi, called Watson earlier this week to pledge $1.15 billion toward the second phase of Ottawa's light rail system.