Mhat are the MTA doing about smartcard ticketing on the Subway and
buses?

As far as I know, they're still scratching their heads. These days
the options seem to be to issue their own smartcard, like PATH did
with Smartlink, or else piggyback on contactless EMV credit cards
(Visa Paywave, Mastercard Paypass, Amex Express Pay) as SEPTA is
doing. Metrocards are already accepted by multiple different
operating authorities (MTA in NYC, Beeline in Westchester, NICE in
Nassau County, and PATH) so I hope that any new smartcard won't work
any worse.

in the area, maybe even for bridge and tunnel tolls.

I doubt that a Smart Card would be used for bridge and tunnel tolls as
most cars in the greater New York area are equipped with special
transponders that toll gates read. They can also be used on other road
agencies' territories -- even in Ontario, in Canada.

Fare payment cards are intended to be read from a few inches away when
they're nearly stationary. E-ZPass transponders can be read from many
feet away when a vehicle is moving at 60 MPH. They're quite different
applications.

By the way, the only place outside the US that E-ZPass works is on the
Peace bridge across the Niagara river, where the toll booths happen to
be on the Canadian side. In Toronto, the 407 toll road uses the same
technology as E-ZPass but for some reason does not interoperate with it.

R's,
John