Separation of COEs for Vehicles for Business and Private Usage

Mr Zaqy Mohamad asked the Minister for Transport (a) whether the Ministry will consider COEs for vehicles of business or commercial use that are separate from vehicles for consumer use in view of the high COE prices that impact upon business costs; and (b) what are the measures being considered to help businesses manage their vehicle purchase costs in the short-term, especially those businesses that are highly dependent on transport vehicles.

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Mr Lui Tuck Yew: Businesses typically bid for Category C COEs to register commercial vehicles. They do not have to compete with other private car buyers who bid for Category A and B COEs. In addition, owners of commercial vehicles enjoy significantly lower vehicle taxes. The Additional Registration Fee (ARF) for all types of goods vehicles (except goods-cum-passenger vehicles 1 ) is set at 5% of the vehicle's Open Market Value (OMV), instead of the 100% OMV applicable for cars.

In May, LTA announced measures to ease the transition to a lower vehicle growth rate. The combined effect of these measures is that in the coming months, almost 50% more Category C COEs would be made available than before the measures. This should help relieve some of the upward pressure on COE prices for commercial vehicles during this period.