Incentives for electric vehicles extended until 2025; lower rebates for some cars

THE Electric Vehicle Early Adoption Incentive (EEAI) scheme will be extended by two years to the end of 2025, with a lower cap on the rebate off the Additional Registration Fee (ARF) for next year.

Rebates for selected cleaner energy cars under the Vehicular Emissions Scheme (VES) will also be lowered, said the Land Transport Authority and National Environment Agency on Thursday (Sep 21).

With the changes to the EEAI, newly-registered electric cars and taxis will continue to receive a 45 per cent rebate off the ARF until 2025.

However, the rebate will be capped at S$15,000 for next year, down from S$20,000 currently.

“Buyers of most mass market electric car models will see no change in the EEAI quantum they receive – this will help to encourage the switch to electric cars, while ensuring the EEAI remains progressive,” said the agencies.

Additionally, the rebate applicable for the VES, which encourages the adoption of cleaner cars, will be lowered from S$15,000 currently to S$5,000 next year for Band A2 cars.

Under the VES, buyers of newly-registered cars and taxis may receive a rebate off the ARF, or pay a surcharge depending on the VES band of the car or taxi.

Cars in Band A2 include the Honda Fit, Mitsubishi Attrage and Toyota Sienta.

There will be no change to the S$25,000 rebate offered for Band A1 cars. Such cars include the Nissan Leaf and Tesla Model 3.

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“The revised VES rebates encourage the adoption of cleaner energy cars, with an emphasis on electric and other zero tailpipe emission cars.”

The agencies added that buyers will be able to see combined cost savings of up to S$40,000 off the ARF when the revised rebates take effect from Jan 1, 2024, to Dec 31, 2024.

For example, under the current rebates offered, the ARF for a Band A2 car such as a BMW i4 M50 Gran Coupe would cost S$82,015. (See *Amendment note)

This is after a rebate of S$20,000 under the EEAI and a S$15,000 rebate under the VES are applied to the initial payable ARF of S$117,015.

With the revisions to the schemes next year, the ARF payable for the same car would be S$97,015. This is after deducting S$15,000 under the EEAI and S$5,000 under the VES.

The agencies said that they will review the VES rebates and EEAI applicable from Jan 1, 2025, and announce the quanta next year as the industry develops further.

Both the EEAI and VES work in tandem to reduce the cost gap between cleaner energy cars and internal combustion engine cars, they said. This has helped to boost the adoption of cleaner energy cars.

For example, electric car registration has risen steadily on a monthly basis from January this year, to reach 23 per cent of new car registrations in August.

From next year, Singapore will also align with global standards on determining emissions and fuel consumption for cars, by adopting the Worldwide Harmonised Light Vehicles Test Procedure as the sole test procedure for new passenger cars and taxis.

The procedure is a more rigorous test cycle that provides more realistic emissions results, said the agencies.

*Amendment note: An earlier version of this story incorrectly said that the ARF for a BMW i4 M50 Gran Coupe would cost S$72,015 after current rebates. The Land Transport Authority and National Environment Agency have since corrected the price and said it would cost S$82,015. This article has been revised to reflect the correct figure.