SINGAPORE - A scheme to encourage the purchase of cars with lower emissions will be extended by one year to Dec 31, 2020.

The Vehicular Emissions Scheme (VES), which came into effect last year and originally due to expire on Dec 31 this year, has been effective in encouraging the uptake of cleaner car models, the National Environment Agency (NEA) and the Land Transport Authority (LTA) said on Wednesday (Oct 30).

It added that there will be no change to the scheme even as its end-date is extended till Dec 31, 2020.

Singapore has been using a taxation strategy to encourage cleaner cars here since 2001.

The latest VES categorises cars according to five key pollutant levels - carbon dioxide, hydrocarbons, carbon monoxide, nitrogen oxides and particulate matter.

Buyers of cleaner car models are rewarded with rebates of up to $20,000, while those who buy cars deemed to have higher emissions will have to pay a surcharge of up to $20,000.

Cars newly registered in certificate of entitlement (COE) categories A (up to 1,600cc and 130bhp) and B (above 1,600cc or 130bhp) can qualify for rebates under the VES.

NEA and LTA said that between July 2018 and June 2019, the number of new cars eligible for rebates in these two categories has collectively increased by about 60 per cent.

In contrast, the number of new cars subject to surcharges under the VES has collectively fallen by about 14 per cent.

According to data provided to The Straits Times by NEA last week, about 10,700 cars registered in the first half of this year qualified for the VES rebates, out of the 39,735 cars that were registered in Categories A and B.

Of the eligible cars, 1 per cent qualified for the VES A1 banding, which gives them a rebate of $20,000. Examples of cars with A1 banding include Bluecar, Hyundai Ioniq and Renault Zoe.

Meanwhile, 26 per cent of the eligible cars fell into the A2 banding, which gives them a rebate of $10,000. Examples include Toyota Prius Plus and Honda Jazz 1.3 CVT.

Said NEA and LTA: "Motor dealers are encouraged to introduce cleaner car models to the market during the extension.

"The scheme will be reviewed regularly, taking into consideration its impact on motorists' purchasing decisions and advances in vehicle technology."