What are the current government policies & laws?
In the previous page, we discovered that the numbers of alt-cars are slowly increasing. I now want to find out the government’s role in this increase, and if they have been slowing down the increase.
I will discuss 2 policies. The Carbon Emissions-Based Vehicle Scheme (CEVS) and the Vehicular Emissions Scheme (VES). The CEVS will be phased out at the end of 2017, and be replaced with the VES. In addition to describing the two schemes and how they operate, I will also talk about the pros and cons they have.
Finally, I will mention the Road Tax that applies to alt-cars as it is a different computation from a conventional vehicle’s road tax.
Carbon Emissions-Based Vehicle Scheme (CEVS)
This scheme was put in place with the intention of encouraging people to change their choice of vehicle to a more eco-friendly option. CEVS, a tax, takes into consideration the vehicles carbon emissions and the fuel efficiency. These two measurements will ultimately determine whether you get a rebate or if you have to pay a surcharge. Below are the different CEVS bands for cars.
| Band | Carbon Emission (CO2, g/km) | Rebate | Surcharge |
| A1 | CO2 < 95 | $30,000 | |
| A2 | 95 < CO2 < 105 | $15,000 | |
| A3 | 105 < CO2 < 120 | $10,000 | |
| A4 | 120 < CO2 < 135 | $5,000 | |
| B | 135 < CO2 < 185 | $0 | $0 |
| C1 | 185 < CO2 < 200 | $5,000 | |
| C2 | 200 < CO2 < 215 | $10,000 | |
| C3 | 215 < CO2 < 230 | $15,000 | |
| C4 | 230 < CO2 | $30,000 |
The rebates or surcharges are deducted or added on respectively to the car’s Additional Registration Fee (ARF). The ARF is a tax that all car buyers have to pay during the initial registration. However, all buyers will have to make a minimum payment of $5,000 for the ARF. This means nobody can have a $0 ARF. In the case of electric cars and hybrid cars (plug-in) that make use of electricity charging points, they will be assigned an emission factor of 0.4g CO2/Wh instead, to calculate their carbon emission. This is done because these cars do not emit carbon dioxide. However, as fossil fuels are burnt during the production of electricity, some emissions would have occurred.
Evaluation of Scheme
The introduction of this scheme was done back in 2013. Since then, the average CO2 emissions of vehicles has decreased by 15%. This goes to show that the CEVS is indeed useful in moving Singapore towards a cleaner and greener city. The reason behind this decrease is that the CEVS addressed an external factor to behavioural change. They did so with the use of a tax. However, the CEVS only took into consideration one air pollutant, that is carbon dioxide. There are in fact many other air pollutants, such as nitrogen oxides and particulate matter that are equally harmful to people and the environment (refer here for more information). This is where the new scheme comes in, Vehicular Emissions Scheme (VES).
Vehicular Emissions Scheme (VES)
The VES will be replacing the CEVS in 2018, thus all new registering vehicles starting 1 January 2018 will be under this scheme. This scheme takes into consideration the measurements of 5 pollutants: carbon dioxide, hydrocarbons, carbon monoxide, nitrogen oxides and particulate matter. The rebate or surcharge for the vehicle will be determined by the pollutant with the lowest band. Therefore, if one’s Particulate Matter is of a Band B, they will not be given any rebate or surcharge, even if other pollutants are in the A1 or A2 band. Below is the VES bands for cars.
| Band | CO2 (g/km) |
HC (g/km) |
CO (g/km) |
NOx (g/km) |
PM (mg/km) |
Rebate | Surcharge |
| A1 | A1<90 | A1<0.02 | A1<0.15 | A1<0.007 | A1=0.0 | $20,000 | |
| A2 | 90<A2<125 | 0.02<A2<0.036 | 0.15<A2<0.19 | 0.007<A2<0.013 | 0.0<A2<0.3 | $10,000 | |
| B | 125<B<160 | 0.036<B<0.052 | 0.19<B<0.27 | 0.013<B<0.024 | 0.3<B<0.5 | $0 | $0 |
| C1 | 160<C1<185 | 0.052<C1<0.075 | 0.27<C1<0.35 | 0.024<C1<0.03 | 0.5<C1<2.0 | $10,000 | |
| C2 | C2>185 | C2>0.075 | C2>0.35 | C2>0.030 | C2>2.0 | $20,000 |
Similar to the CEVS, the surcharge or rebate will be done to the buyers ARF. In addition, the emission factor for electric and hybrid (plug-in) cars will continue unamended.
Evaluation of Scheme
The change in policy will address the limitations the CEVS had. In addition, it will prompt buyers to fully assess the car model they intend to buy, as they will be pressured to purchase vehicles that are cleaner overall. This new scheme has the potential to improve air quality in Singapore, as well as reverse the effects of climate change. Lastly, I believe the VES will be as or even more successful because it too addresses an external factor to behavioural change, with the use of taxes.
Road Tax
All car owners have to pay road tax. Typically, road tax is calculated by the cc of the car.
Road tax for a petroleum car:
| Engine Capacity (EC) in cc | 6-Monthly Road Tax Formula |
|---|---|
| EC < 600 | S$200 x 0.782 |
| 600 < EC < 1,000 | [S$200 + S$0.125(EC – 600)] x 0.782 |
| 1,000 < EC < 1,600 | [S$250 + S$0.375(EC – 1,000)] x 0.782 |
| 1,600 < EC < 3,000 | [S$475 + S$0.75(EC – 1,600)] x 0.782 |
| EC > 3,000 | [S$1,525 + S$1(EC – 3000)] x 0.782 |
Road tax for a diesel car:
| Engine Capacity (EC) in cc | 6-Monthly Road Tax Formula |
|---|---|
| EC < 600 | S$200 x 0.782 |
| 600 < EC < 1,000 | [S$200 + S$0.125(EC – 600)] x 0.782 |
| 1,000 < EC < 1,600 | [S$250 + S$0.375(EC – 1,000)] x 0.782 |
| 1,600 < EC < 3,000 | [S$475 + S$0.75(EC – 1,600)] x 0.782 |
| EC > 3,000 | [S$1,525 + S$1(EC – 3000)] x 0.782 |
Road tax for a hybrid car:
| Power Rating, PR (kW) | 6-Monthly Road Tax Formula |
|---|---|
| PR < 7.5 | S$200 x 0.782 |
| 7.5 < PR < 32.5 | [S$200 + S$2(PR – 7.5)] x 0.782 |
| 32.5 < PR < 70 | [S$250 + S$6(PR – 32.5)] x 0.782 |
| 70 < PR < 157.5 | [S$475 + S$12(PR – 70)] x 0.782 |
| PR > 157.5 | [S$1,525 + S$16(PR – 157.5)] x 0.782 |
Road tax for an electric car:
| Power Rating, PR(kW) | 6-Monthly Road Tax Formula |
|---|---|
| PR < 7.5 | S$200 x 0.782 |
| 7.5 < PR < 32.5 | [S$200 + S$2 (PR-7.5)] x 0.782 |
| 32.5 < PR < 70 | [S$250 + S$6 (PR-32.5)] x 0.782 |
| 70 < PR < 157.5 | [S$475 + S$12 (PR-70)] x 0.782 |
| PR > 157.5 | [S$1,525 + S$16 (PR-157.5)] x 0.782 |
The special case is the hybrid car (aka petrol-electric car). One will pay the higher of the two: a) engine capacity calculation (refer to petroleum car computation) or b) power rating calculation. This may make the decision to switch to a hybrid car less attractive because you are likely to end up paying the same road tax as a traditional fuel car, or more if the power rating of your choice car is very high.
Take for example, the BMW 530i Sedan, a plug-in hybrid and its traditional fuel counterpart, the BMW 530 Sedan.
| BMW 530e iPerformance Sedan | BMW 530 Sedan | |
| cc | 1998 | 1998 |
| Power Rating | 135kW | – |
| Road Tax payable | $982 ($605 if based on CC) | $605 |
Evaluation of Scheme
The comparison, as shown above, is a perfect example of how going green can be costlier. Not all car users have the luxury of paying $300 more every 6 months. This proves my point that the current road tax scheme for hybrid cars is very unattractive for certain car models. It now seems that we are instead punishing Singaporeans for their initiative to go green. Although the CEVS and VES may offset a large portion of the initial downpayment for the Additional Registration Fee (ARF), that is merely a one-time payment. Drivers will still have to make semi-annual Road Tax. If you were to do the math, it seems that the more expensive Road Tax will be paid for by the rebates received from the VES.
The Road Tax scheme had the potential to aid in curtailing behaviour. Unfortunately, it appears that the heavy tax on the green cars is doing more harm than good. Taxes will reduce a given behaviour, therefore, instead of encouraging the pro-environmental choice of alt-cars, the Singapore government is only discouraging it.
With all these drawbacks owning an alt-car pose, I will now move on to discuss the overall feasibility of owning and driving an alt-car in Singapore. Click here to read!