It’s a well-known fact that Singapore is one of the most expensive countries in the world, no thanks to its million-dollar public housing and of course, expensive car ownership. With its efficient and cheap public transport system, what makes Singaporeans continue to splurge serious money on buying cars?
Convenience is a common reason; there’s no need to wait for taxis or be subject to surge-pricing during peak hours. Some also like the idea that they can ferry their loved ones around to work or school on a daily basis. And if you are thinking of buying one soon, you might be keen to find out the total costs involved in getting one, since the different layers of taxes and fees can get rather confusing.
Here, we give a breakdown of the total costs involved using a popular car model in Singapore – the Toyota Corolla Altis.
According to the Land Transport Authority, the selling price for the Toyota Corolla Altis quoted by authorised dealers in March 2018 is $99,988. Let’s have a look at the different components that make up the total car price.
9 main factors contributing to cost of car ownership in Singapore:
- Registration Fees
- Open Market Value (OMV)
- Excise Duty
- Certificate of Entitlement (COE)
- Additional Registration Fee (ARF)
- Vehicular Emissions Scheme (VES)
- Road Tax and Insurance
- Car Dealer Commission
- Miscellaneous – maintenance, parking fees & petrol
A registration fee of S$220 will be collected upon registration of the car.
Open Market Value (OMV)
The Open Market Value is determined by the Singapore Customs as the vehicle enters the country. This value includes the purchase price, shipping and other charges included in the delivery of the car to Singapore.
The Excise Duty is a tax collected by Singapore customs and is at 20% of the car’s OMV.
Certificate of Entitlement (COE)
Buying a car in Singapore requires one to have a COE, which is the legal right to register, own and use a vehicle in Singapore. Unfortunately, the COE only lasts for 10 years. The cost of COE depends on the demand and supply of the market and is divided into the following 5 categories:
- CAT A – Car up to 1600CC and 97KW
- CAT B – Car above 1600CC or 97KW
- CAT C – Goods vehicle and bus
- CAT D – Motorcycle
- CAT E – Open-all except for motorcycle
Here’s the latest COE result (updated as of June 2018):
|CAT D (Motorcycle)||S$7,001|
|CAT E (Open-all except motorcycle)||S$37,000|
Addition Registration Fee (ARF)
Additional Registration Fee is imposed upon registration of the car. It is calculated based on a percentage of the Open Market Value (OMV) of the vehicle. As for now, any vehicle of OMV up to S$20,000 will be subjected to 100% OMV. Vehicles with OMV above S$20,000 will be taxed differently based on incremental OMV.
Vehicular Emissions Scheme (VES)
The Vehicular Emissions Scheme (VES) was introduced on 1 January 2018 and applies to all new cars registered. The VES has two bands – rebate of either $10,000 or $20,000, and surcharge of either $10,000 or $20,000. The objective of the VES is to encourage buyers to purchase environment-friendly cars.
Road Tax and Insurance
All vehicle owners must have a valid road tax for their vehicle before they can drive iit on the road. Most vehicles’ road taxes are renewable on a six-monthly or yearly basis. Based on the chosen car model. Total road tax comes up to about $742 per year.
In Singapore, it is illegal to drive a vehicle without valid insurance coverage. The penalty for the offence includes a fine of up to $1,000 or imprisonment of up to 3 months or both, and a mandatory disqualification from holding a driving licence for at least 1 year.
The minimum cover type is third-party only cover – it is the cheapest but also offers the least protection. The starting quote for basic car insurance coverage for a 40 year old married male is around $400. Maintaining a good driving record would entitle you to No-claim Discount which can help you save substantially on your car insurance.
Car Dealer Commission
When you buy a car from a dealer, you’ll have to pay the dealer’s gross profit cost, which includes commissions, overhead costs and warranties. Although the amount varies depending on the dealer you go to, you can expect to pay around $20,000.
Other costs that can add up include parking fees, car maintenance, inspection, GST and of course, ongoing fuel costs. These are largely subjected to individual usage and choice.
Here’s an estimate of the car’s total cost once you factor in the fees and expenses:
|Car Cost Factor||Price|
|Open Market Value (OMV)||$19,741|
|Certificate of Entitlement (COE)||$36,426|
|Additional Registration Fee (ARF)||$19,741|
|Vehicular Emissions Scheme (VES)||$0|
|Annual Road Tax and Insurance||Road tax – $742
Car Insurance (Third Party only) – around $400
Total basic cost of owning a Toyota Corolla Altis – S$102,876