Breaking the obesity cycle

Get a tax break for cycling to work?  Sound like a fairy tale?  Well not if you live in the UK.  The British government has made it possible to get a tax break of up to 53% on the purchase of bicycles and accessories. You can learn more about the scheme here.

Think it’ll never happen in Australia?  Well don’t be so sure!  The government has launched a preventative health taskforce, and one of its targets is to reduce the rise in obesity.  It is recommending initiatives that reward employers through grants and tax initiatives for workplace measures that result in a healthier employee base.

So perhaps allowing people to salary sacrifice for bicycles is positive step towards meeting this health goal.  Interestingly enough, a number of cycling groups recently suggested this tax break in their submission to the Henry Tax Review.

So do you reckon that the salary sacrifice of bicycles is a good idea?  It would be a good health initiative that is also good for the environment.  Plus, the tax savings could be delivered through existing salary sacrifice arrangements, so would not require a costly government run scheme.

Let’s run a little poll and see what you think.

You can also leave a comment here

Deven

55 Responses to “Breaking the obesity cycle”


  1. 1 Raj October 12, 2009 at 10:46 pm

    This is a ridiculous idea. Bicycles!!!…no way….sacrifice for consumables and thats a win win……. People should be able to salary sacrifice work related expensive items like IPhones,Laptops (you already ahave that in place).

    Have a deal, Buy a laptop and an Iphone for the price of a laptop and salary sacrifice…..more people would die to do that than bicycle to work.

  2. 2 I.M. Sexay October 16, 2009 at 9:36 am

    Sounds like an excellent idea – the economic cost of rising obesity affects all Australians given the additional strain (or is that weight?) on the public health system. While I don’t have a quantitative analysis in my back pocket – I believe there is a significant social benefit to provide tax breaks for health- related items.
    How do you argue against incentivising encouraging people to be healthy?

  3. 3 Bianca October 21, 2009 at 6:50 pm

    I think this is a fantastic idea!
    A large percentage of my workplace cycle to work and if people can salary sacrafice a car, why not a bike, as a bike is also a form of transport! As mentioned, it seems like a win win, in that it will help offset carbon emissions and more importantly, help the Australian obestity crisis, which in turn will hopefully lessen the burden on the public health care system, and improve overall fitness.

  4. 4 John Mulder October 21, 2009 at 8:38 pm

    Sounds fair. You can do it for cars, why not bikes? A lot of people ride to work everyday. It saves them money. They don’t waste money on parking fees and its healthy.. (unless someone abuses you on your bike or tries to run you over). I’ve been riding to work for years, and my bike is wearing out. I’ll have to by a new one sooner or later. I’d love to salary package it.

  5. 5 George Patton October 21, 2009 at 9:11 pm

    I use a bicycle for travelling between meetings both within the organisation and externally. If I were not using the bike I would be using a car which I might salary package. So why should I not be able to package the bike. The costs to the taxpayer is minimal compared to the cost of packaging a car.

  6. 6 Darren October 21, 2009 at 10:55 pm

    why stop there? incentivise other healthy activities as well…gym/sports club membership, sport participation fees, home gym equipment. I know there is no guarantee that the equipment/gym gets used, but financial incentives would hopefully encourage more people to see organised exercise/sport as an option if their personal financial situation did not previously allow it.

    • 7 ceosmartsalary November 5, 2009 at 9:39 am

      Good point Darren. Gym memberships can currently be packaged, but only if they are on “employer premises” – this may have made sense at some point, but it seems crazy now. Opening it up so that all gym memberships can be packaged would help the government to better tackle its health initiative.

  7. 8 Maureen October 21, 2009 at 11:01 pm

    Why not sacrifice the essentials like private health insurance or other insurances, forget gimmicks. I am sure a lot of sacrificers already own bike and so do their children, so there is no gain for those people.Private health insurance is an essential life commitment and damned costly. By being able to scarifice some percentage or all the cost would encourage non insurers tob join private funds and this would help to relieve the burden on the public health system.

  8. 10 Nigel October 22, 2009 at 8:26 am

    As someone who already uses salary sacrifice for a vehicle I would be more than happy to have some incentive to not use the vehicle as much as I do. I need to do 25000km per year in my car, typically I do 35,000km, so I am being encouraged and subsidized to use resources and pollute the environment. I have frequently thought about cycling to work, which would be a 50km round trip once a week. This is not a long way and would be much quicker than public transport which takes at least 90-120 minutes, each way.
    The main drawback for doing this is my old bike which is 25 years old and heavy. Trying to justify spending a $1000 for a new modern lighter bike up front is difficult however being able to bury the purchase price into my salary and receive a tax break would easily sway my decision.
    Others have pointed out that health insurance would be useful however this product exists for getting health back unlike a bike, whose use will prevent people from getting sick in the first place. Even taking possible accidents into account the overall health benefits of the exercise would outweigh the risks.

  9. 11 ff October 22, 2009 at 8:41 am

    Salary Sacrifice should also cover maintenance and parts for upkeep.

    • 12 ceosmartsalary October 29, 2009 at 1:13 pm

      Ya, it would make sense to include the upkeep – just like with novated leases. I believe that the UK scheme includes the accessories, but not the upkeep. The reason for this is probably logisitical complexity . . . the complexity of running expenses through a government run scheme. In Australia, however, it would be easy enough to salary package any upkeep.

  10. 13 Tri October 22, 2009 at 7:44 pm

    I strongly support this idea.
    For those who live closer to the city, say within a 15km radius, having a salary sacrificed bike to ride to work, will ease traffic congestion. The user will be healthier, and have less dependency on the health system. A small tax break, will have longer term benefits, and better quality of life of those who participates.
    The Federal Government is forever saying that the health budget is going to be a burden on younger generations, with the Baby Boomer aging generation. Let us give support to a cheap alternative solution now so that the benefits will be reaped when there is less dependency on our breaking point health system.

  11. 14 jane October 22, 2009 at 9:00 pm

    what about those that walk to work. i walk to work everyday it takes about half hour each way.

    • 15 Stephanie October 30, 2009 at 12:42 pm

      I’m not sure how walking to work could be packaged, but being able to package sports shoes might be a great idea! If I can package a rich, creamy meal in a restaurant, then I should be able to package the shoes (which could be in the same price range for some!) to work off the rich creamy meal!

  12. 16 Cuttsy October 23, 2009 at 8:11 am

    If a car, why not a bicycle? It promotes a healthy lifestyle – I have been a regular bicycle commuter for around five years and my health has never been better. A lease type arrangement as they already have with cars would mean an upgrade every few years – brilliant! Sure it’s not for everyone, but neither is salary sacrificing a motor vehicle.

  13. 17 Jon October 23, 2009 at 8:29 am

    Personally, I use cycling as an important cross-training activity to maintain my physical fitness standard (a requirement of my Defence employment), without the heavy impact of running all-year round. The fact that I can commute to work at the same time is a win-win situation. Good quality bicycles are expensive, but they do last longer and run very reliably. This encourages you to keep commuting, which is good for your health and good for the planet. It would be fantastic if I could salary package a reliable bicycle and the cost of parts and maintenance. Not only that, it would seem fair to be able to do so at a time when other sectors of the labour market have the ability package home loans and other such benefits. I fully support the proposal to package bicycles and their up-keep.

  14. 18 Jon October 23, 2009 at 8:30 am

    Personally, I use cycling as an important cross-training activity to maintain my physical fitness standard (a requirement of my Defence employment), without the heavy impact of running all year round. The fact that I can commute to work at the same time is a win-win situation. Good quality bicycles are expensive, but they do last longer and run very reliably. This encourages you to keep commuting, which is good for your health and good for the planet. It would be fantastic if I could salary package a reliable bicycle and the cost of parts and maintenance. Not only that, it would seem fair to be able to do so at a time when other sectors of the labour market have the ability package home loans and other such benefits. I fully support the proposal to package bicycles and their up-keep.

  15. 19 Alan October 23, 2009 at 8:40 am

    We live in a world full of convenience but lacking in patience. In Australia, one third of the population is overweight and another third is obese. I think any incentive to get people active, to take some time and appreciate their surroundings and to help reduce carbon emissions should be applauded.

  16. 20 AR October 23, 2009 at 9:04 am

    An incentive promoting a healthy alternative to congested roads and public transport system; should be a no brainer! Relating this to charity or payment for the unemployed is simply obtuse. As recognised in previous submissions, the benefit from this would be far wider reaching than the individuals that use it. The individual, their family, society, the environment and the workplace would all benefit from healthy activity. Great idea!

  17. 21 Veronica Hunt October 23, 2009 at 11:28 am

    Although I think that Raj’s point is valid I believe that this is a fantastic idea that addresses health and well-being and environmental issues. I am all for it and will be accessing it ASAP if it is approved as a salary sacrificing item! Beats the car, public transport and/or walking!

  18. 22 Phil October 23, 2009 at 11:47 am

    Fantastic idea.
    The more cars we get off the road the better.
    There is a plus for the environmet and with less traffic on the road I can get to work a lot faster in my twin turbo, 351 Mustang.
    Freeway here I come.

  19. 23 VC October 23, 2009 at 2:28 pm

    At first it seems a little way out there but what a great idea.
    Bicycles are a mode of transport that keep the workforce fit and healthy and as an added bonus, resolve the car park issues!

  20. 24 Ray October 23, 2009 at 3:00 pm

    Good Idea. I’d probably cycle to work if I could get a decent bike for a decent price. Has ther been any thought given to additional infrastructure that goes with extra bikes(secure bike racks etc)?

  21. 26 Rajesh Kumar October 26, 2009 at 8:49 am

    I think it is good idea, as more people will start using the bike as a form of transport and get healthier.

  22. 27 Glen October 26, 2009 at 3:24 pm

    I think it’s a fantastic idea. The initial costs in administering the scheme would be more than offset by the reduction in obesity-related diseases, CO2 emissions, and MVA-related injury care. As someone who has about a 60km round-trip, my fitness has improved dramatically since I started riding. As someone else mentioned though, maintenance costs should be salary-sacrificable too—bike parts aren’t cheap. New rear tyre every few thousand km, decent chain-lube, activity-appropriate clothing (yes, the lycra)—it all adds up.

  23. 28 Bob October 27, 2009 at 11:15 am

    Why all the blather about Health, enviroment etc etc . If its good enough for cars should be good enough for motorbikes and bycyles.

    Should be available for health insurance too – all the bikers will need it sooner or later

  24. 29 whibble October 27, 2009 at 1:37 pm

    As it stands, Salary sacrificing is geared towards increasing economic activity rather than hea;th and the environment. As an example, it was more beneficial for me to sal sac a 6 cyclinder Falcon than a new prius, because whilst the higher prius cost had the fuel savings factored into the purchase cost, this is penalised by the FBT being calculated on new price of the Pruis – wherease the extra fuel used by the falson was compensated for by the generous saving on fuel. Hardly environmentally focussed. Sorry to say i wasn willing to “take one for the eco-team” and pay sigmnificantly more to fund the hybrid industry.

    This should change. There should be more incentive given by govt to environmentally-concious and health inductries, like the Prius and cyclig, as we will all benefit in the long run by more efficiency and better health choices such as cycling with the attendant reduction in govt-funded healh care. I think his is a winner of an idea

  25. 30 M October 28, 2009 at 12:45 pm

    Awsome idea, I wanted to buy a bike to ride to work but don’t want to pay the $2000 it would cost to buy one for a bloke my size. BRING ON THE TAX SAVINGS YEEEHAA.

  26. 31 freedom from the system October 28, 2009 at 7:32 pm

    How pathetic that we won’t do anything good for ourselves and the rest of the world that us fat Western people need an incentive to stop eating to much. Good on those who have a bike. The reality is that the majority of people that aren’t riding a bike now, would buy one and leave it in the garage after two months. Why not use the body mass index as a basis for taxation and watch what happens??

  27. 32 Nelson Rapp October 29, 2009 at 6:38 am

    Sounds good

  28. 33 Pat October 29, 2009 at 7:24 am

    Fantastic idea,

    About time we see the implementation of chronic disease prevention measures/incentives to tackle the ever growing waistlines of Australians.

  29. 34 Geoff October 29, 2009 at 10:52 am

    Superb idea.

    What’s the stats – 1 in 2 are overweight in Austraila now? Come on the Govt is giving a 50% tax rebate on cars (mostly 4WD) for business at the moment – where is the sense? Yet no on the humble, health promoting, environment saving pushie!

  30. 35 Jason October 29, 2009 at 11:00 am

    This is a great idea. As someone who started riding my bike to work a couple of years ago, I have not only used less carbon emissions and money, but my health and fitness has improved as well. I am more productive at work and achieve more with less stress. I am sure that this activity is saving our health system and my employer money. Coincidently, the bike I have been riding over the past couple of years has become run down and now needs major repair. A scheme like this would keep me on the bike and continue to save money for the overall system!!

  31. 36 bec October 29, 2009 at 7:34 pm

    This is a great idea! I’m not pleased that the salary sacrificing system seemingly rewards car lease participants for travelling further and therefore being less enivonmentally friendly every year. Anything that encourages better health and more sustainable travel (whether it be riding bikes, scooters, public transport or walking to work) wins my vote and business.

  32. 37 eamonn October 29, 2009 at 10:01 pm

    A great idea but why not include motorcycles….I know they don’t make you thin but they are a great mode of transport, are better for the enviornment, they would reduce parking problems, reduce traffic congestion and they get you their quicker
    So lets have a vote on motorbikes as well.

  33. 39 Stephanie October 30, 2009 at 12:38 pm

    This is a fantastic idea! What a great incentive to reduce single-person car trips to and from work, or to and from train stations! Anything that will reduce carbon emissions must be a good thing. As long as the workplace then has appropriate bike storage and shower/locker facilities for its healthy workers.

  34. 40 cristine October 30, 2009 at 8:02 pm

    how about being able to sacrifice Motorbikes, now there is a good idea!!!!!!

  35. 42 Mark Krelle October 30, 2009 at 9:08 pm

    yeah sounds like a great idea,I would do it for sure.
    Regards Mark

  36. 43 Matt October 31, 2009 at 9:14 am

    The UK plan makes sense and they even went the step further in some companies whereby they were given further tax incentives if they provided Electric bikes and charging points for staff to borrow the bikes plus the change rooms and shower facilities. It may be that some people are grossly overweight and a normal bike won’t do as they need the extra assistance until their weight drops. If a health package were developed to include a bike or health club membership etc, I think it would be a great step forward in reducing the national obesity trend.

  37. 44 sarah November 2, 2009 at 7:16 pm

    I think this is a fantastic idea. This should be a national initiative that anyone in any job/ position has assess to. I think it would encourage more people to ride more often.

  38. 45 Adam Bruce-Allen November 3, 2009 at 7:18 am

    Brilliant I cycle 10 kms to work and back every day and would love to take advantage of this a salary packaging option and get a sturdier bike.

  39. 46 Jacqui November 3, 2009 at 8:27 am

    This is a great idea, I also like the idea of private health insurance being available to Salary Sacrifice.
    If we are serious abuot decreasing obesity the idea of gym memberships, should also be encouraged.

  40. 47 Billy November 4, 2009 at 6:35 pm

    What a totally incoherent response Raj……….terrible!!!

    I think its would be a fantastic benefit to be able to salary sacrifice a bicycle – especially if it is your means of transport to and from work!

  41. 48 sara November 4, 2009 at 9:13 pm

    I am just seriously considering buying a bike to ride to work, if I could salary package it I would already have it!! Great idea.

  42. 49 Richard Chapman November 5, 2009 at 8:24 am

    Think this would be a great idea to promote a healthy mode of transport to work. Fully support any initiatives that assist with the health and well being of the population. I think this would need to be supported with some driver education and more bike lanes – its a bit hairy on the roads particularly during peak hour – one of the major things that puts me off is having to ride in heavy traffic. I have friends who ride and they are constantly dealing with near misses with vehicles.
    Otherwise fully support.

  43. 50 bicycle commuter November 5, 2009 at 9:04 am

    Cycling should definitely be allowed to be packaged and salary sacrified.

    If bicycles, motorcycles, potentially sports shoes, and public transport are not allowed to be salary sacrificed, why should cars be allowed?

    What makes cars so important?

    Cycling, walking, and public transport is the way of the future. It ecourages better physical and mental health – getting out of the car, lowers congestion on our roads, and much more.

    It’s time for us to step up and make some important changes to our lifestyles and our country.

    Great post Deven.

  44. 51 ipallo November 5, 2009 at 10:24 pm

    Walking is also a good way to get to work.

  45. 52 Georgina Taylor November 19, 2009 at 7:24 am

    You are able to salary package a leased vehicle, why not a tax break for those who use public transport.

  46. 53 Kelly December 1, 2009 at 10:22 pm

    I used to get my parking fees taken out of my wages pre tax. Now I have no parking and travel 35km every day via public transport. If I could pay for my travel with salary sacrifice it would be a great help. I certainly get no thanks for leaving my car at home.

  47. 54 Milo December 3, 2009 at 8:58 am

    I agree with Richard on this one. Whilst a tax break on the purchase of my bike would be ideal, the roads can be a bit tricky during peak hour. That said, I’d be prepared to face the wrath of motorists to get a cheaper bike. Question, reckon we could ask for tax breaks on bicycle accessories also? I wouldn’t mind getting a tax break on one of those garmin bike computers.

  48. 55 Madhava March 23, 2010 at 9:07 am

    I think this is a great idea. A sort of novated lease on bicycles, like cars, would really help us in getting decent bikes.


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Deven Billimoria
Chief Executive Officer
Smartgroup

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