Singapore to Tax Luxury Cars Even More
The one reason Automologist MAC chooses Malaysia over Singapore…
The cost of driving a luxury car in Singapore is set to get even more expensive than it already is after the Deputy Prime Minister, Lawrence Wong, announced in his budget speech a massive hike in the Additional Registration Fee (ARF), which is a tax that is imposed when you register a vehicle.
According to the DPM, the aim is to create a more progressive vehicle taxation system and the change will be implemented on cars above the S$40,000 mark, with the tax rising to 320% (up from 220%) for cars above S$80,000 of the Open Market Value (OMV), which is the approximate cost of a vehicle prior to taxation.
In a way, this may be considered a bit of a cynical tax designed more to raise funds than to alter behaviour. Buyers at that end of the market generally are not cost-sensitive. If anything, for those “crazy rich Asians”, this may in fact be the clarion call to get the next best thing in four-wheeled mobility.
Experts in the Island State seem to agree. Reports in the local paper cite a prominent banker as claiming that the luxury car market remains affordable even after the ARF adjustment. Others claim that the demand is there simply because of the inflated prices. Sellers of luxury cars are not expecting any real impact on their sales either as the increased price will only reinforce the exclusivity of the vehicles in that segment of the market.
I like Singapore but I also like my cars. So, for that reason, I am just glad I don’t live there anymore. Here is the full break down of the additional taxes, image courtesy of the Land Transport Authority (LTA):