Budget 2021: New measures to narrow cost difference between electric cars and conventional cars

The minimum additional registration fee for electric cars will be lowered, and road taxes for electric cars will also be revised. ST PHOTO: KELVIN CHNG

SINGAPORE - More measures will be rolled out to narrow the cost of owning an electric vehicle compared to petrol and diesel vehicles, to encourage drivers to make the switch.

Deputy Prime Minister Heng Swee Keat on Tuesday (Feb 16) said the minimum Additional Registration Fee (ARF) for electric cars will be lowered to zero from January 2022 to December 2023.

Currently, all car buyers have to pay at least $5,000 in ARF, regardless of the tax rebate a car is entitled to.

Mr Heng said lowering the ARF floor will enable mass-market electric car buyers to maximise tax rebates from the Electric Vehicle Early Adoption Incentive.

Road taxes for electric cars will also be revised, such that a mass-market electric car will have road tax comparable with an internal combustion engine (ICE) equivalent, he added.

More details will be announced when MPs debate the budgets of various ministries from next week.

These moves are the latest in a series of measures by the Government to speed up the phasing out of vehicles running purely on fuels here.

As part of the inter-ministerial Singapore Green Plan 2030 announced last Wednesday, the Government said it would revise Singapore's multi-layered vehicle tax structure to "make it easier to buy and own" electric vehicles (EVs).

EV incentives were enhanced just last month, when bigger rebates under the Vehicular Emissions Scheme as well as the Electric Vehicle Early Adoption Incentive kicked in.

Together, they accord an electric car buyer as much as $45,000 in tax breaks. The road tax formula has also been revised to make it less onerous for electric car owners.

In terms of infrastructure, the Government will more than double the targeted number of public EV charging points from 28,000 to 60,000 by 2030.

Mr Heng on Tuesday said $30 million will be set aside over the next five years for initiatives related to electric vehicles, like measures to increase the number of chargers at private properties.

The various measures will help reshape Singapore's transport footprint towards cleaner transport, he added.

Read next: Highlights of Budget 2021 - From household vouchers to GST on imported low-value goods bought online

Join ST's Telegram channel and get the latest breaking news delivered to you.