The math of car ownership in Singapore
By Murray Bourne, 15 May 2006
When I arrived in Singapore 9 years ago I already knew that car prices were nothing short of stratospheric. A standard Corolla was just under SGD$100,000 (or about USD$70,000 or $100,000 Australian dollars at the time).
So I have been fine without a car here. Public transport is good and taxis are mostly plentiful.
I think the Singapore model of restricting car ownership is a good one, except I am concerned with their 4% growth rate per year - that's high.
Anyway, costs have gone down in recent years - that same Corolla costs around $75,000 - a steal.
A recent Straits Times article explains the costs of car ownership in Singapore.
A car starts with an OMV (Open Market Value). This is determined by Customs, and takes into account the cost price, freight, insurance, handling plus whatever.
Added to that is:
- ARF (Additional Registration Fee): 110% of OMV
- COE (Certificate of Entitlement): You have to have this before you can buy a car. The price is determined by an aucttion system. Currently the COE for a Corolla is around $10000.
- Excise Duty: 45% of OMV
- GST (Good & Services Tax): 5% of cost including excise duty
- Registration Tax: $140
- Road tax: $1000 per year for a Corolla
- Transfer fee: 2% of the vehicle's value
Whew! So our $20,000 Corolla can grow to $75000 with all the extras.
Added to that is:
- ERP (Electronic Road Pricing): A clever system that removes money from a cashcard as you drive under a gantry. Used duing peak hours for controlling traffic flow - oh, and gaining revenue.
- Fuel costs: Around $1.40 a litre
- Maintenance: Ever tried to service a modern car? Ya gotta pay someone to do it.
- Tyres: They change them every year
- And so on...
But Singaporeans love to drive - and love the status symbol of car ownership.
Me, I'll walk...
See the 3 Comments below.
11 Nov 2008 at 11:54 am [Comment permalink]
[...] has worked for the country. And then, there is the much-admired Electronic Road Pricing system and taxes on automobiles, which disincentivizes people to own cars and drive downtown during peak hours. The pricing of [...]
26 Sep 2009 at 3:00 am [Comment permalink]
I live in Canada and have 3 cars and it costs me about $7000 for all three cars a year. That's driving about 25000km a year. With $25,000 I bought a Roush modified Mustang GT with over 400hp as my fun car. $23000 nets me a 7 seater Honda Odyssey with 240HP V6, and my daily commuter is a Honda civic that I bought for $12k. I'm your typical "average" Canadian graduate earning $70k a year.
You can equate this to the difference between living in Zimbabwe vs Canada. Why would I want to live in poverty when I don't have to?