Penalties for pollutive light commercial vehicles to increase; incentives for cleaner ones continue

HIGHER surcharges will soon kick in for more pollutive light commercial vehicles (LCVs), while incentives for cleaner vehicles will remain.

The Land Transport Authority (LTA) and National Environment Agency (NEA) Commercial Vehicle Emissions Scheme (CVES) announced on Monday (Dec 30) that incentives for vehicles in Band A under the CVES will be extended for two years from Apr 1, 2025 till Mar 31, 2027. 

CVES was introduced in April 2021 to promote the adoption of cleaner LCVs. It applies to all new and used imported LCVs.

The incentive for commercial vehicles in Band A – electric vehicles – will remain at S$15,000, while the incentive for Band B – mainly petrol vehicles – will be removed. The surcharge for Band C – mainly diesel vehicles – will be raised from the current S$15,000 to S$20,000 on Apr 1, 2025. 

These changes are in line with the Singapore government’s vision to have all vehicles run on cleaner energy by 2040.

CVES applies only to light goods vehicles, goods-cum-passenger vehicles and small buses with a maximum laden weight not exceeding 3,500 kg. 

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Meanwhile, the Early Turnover Scheme (ETS) for heavy commercial vehicles, which includes heavy goods vehicles, very heavy goods vehicles, goods-cum-passenger vehicles and buses, with maximum laden weight exceeding 3,500 kg, will be extended till Dec 31, 2025. The scheme will cease thereafter.

The ETS was introduced in April 2013 to encourage the replacement of older and more pollutive diesel commercial vehicles and buses. 

The ETS offers a discount off the prevailing quota premium – the amount to extend or renew the Certificate of Entitlement of an existing in-use vehicle – when owners of older diesel commercial vehicles and buses switch to cleaner new vehicles.

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For LCVs, the ETS will cease after Mar 31, 2025, as announced previously on Nov 15, 2022.

Around 80 per cent of LCVs registered from April 2021 to this September were cleaner models since the implementation of the CVES, coupled with ETS. Approximately 70,000 vehicles eligible under the ETS scheme have been replaced with cleaner models as at September.