LTA and NEA to continue incentivising adoption of cleaner energy vehicles, with emphasis on electric vehicles

4 October 2024

On 20 September 2024, the National Environment Agency (“NEA”) issued a press release announcing the sustained government support for Singapore’s transition to cleaner energy vehicles. To support the vision of 100% cleaner energy vehicles by 2040, the Land Transport Authority (“LTA”) and NEA will continue to incentivise the adoption of cleaner energy vehicles from 1 January 2025 to
31 December 2025, with an emphasis on electric vehicles (“EVs”), in the following ways:

• EEAI and VES Band A1 rebates maintained to support adoption of electric cars: LTA will maintain the existing EV Early Adoption Incentive (“EEAI”) quantum. Owners who register electric cars and taxis in 2025 will continue to receive a rebate of 45% off the Additional Registration Fee (“ARF”), capped at S$15,000. The S$0 ARF floor for electric cars and taxis will also be extended till 31 December 2025.

NEA will maintain the Vehicular Emissions Scheme (“VES”) Band A1 rebate quantum for cars and taxis. The VES Band A1 rebate, which applies to most electric cars, will remain at S$25,000.

• VES Band A2 rebate adjusted: The VES Band A2 rebate, which applies mainly to hybrid cars, will be lowered from S$5,000 to S$2,500.

With the revised VES rebates in effect and the continuation of the EEAI, buyers will continue to enjoy combined cost savings of up to S$40,000 off the ARF for electric cars in the said period. Most electric car models will continue to receive the same level of rebates as they do currently.

NEA explains that both the EEAI and the VES work in tandem to reduce the cost gap between cleaner energy cars (including electric and hybrid cars) and internal combustion engine (ICE) cars, and have helped to boost adoption of cleaner energy cars. NEA reports that cleaner energy car registration has increased to around 80% of all new car registrations between January 2024 and August 2024 and new electric car registration in the same period accounted for around one-third of all new car registrations.

Reference materials

The press release is available on the NEA website www.nea.gov.sg.

More information on the EEAI and VES is set out on the One Motoring Vehicle Tax Structure webpage.