“The objective of the public consultation is to seek views on how to more effectively distinguish between mass-market and higher-end cars in the COE system, while allowing COE prices to continue to be determined by market forces,” said LTA.
It comes after Transport Minister Jeffrey Siow said at the ministry’s Budget debate in March that he had asked LTA to review the issue.
The agency engaged more than 200 members of the public, academics and automotive industry representatives on their suggestions for the COE system, which allocates vehicle quotas to control traffic congestion in Singapore.
“As vehicle technology and the vehicle market continue to evolve, it is timely to review whether the current categorisation of cars remains fit-for-purpose. Through this consultation, we invite the public to share their views on the proposed changes and trade-offs involved,” said LTA chief operating officer Lim Zhijian.
HOW IT WOULD WORK
After the merger of the two categories, each car’s COE price would be adjusted by a rebate or surcharge if necessary, based on the median open market value of the car model.
The open market value is the cost of a vehicle imported into Singapore as assessed by Singapore Customs, taking into account the purchase price, freight, insurance and all other sale and delivery charges for importing the car.
This value is currently used to calculate a car’s Additional Registration Fee.
The median open market value would be based on past registrations of the same model over a set period, such as the past year. The percentile into which that median falls would then determine which fee or rebate band applies to the car.
The consultation paper outlines two possible structures. A three-band structure would have a S$15,000 rebate band, a middle band with no adjustment and a S$15,000 surcharge band.
This would be simpler to administer but adjustments between adjacent bands would be larger, LTA said.