Particular About Particulates

Singapore’s new Vehicle Emissions Scheme, which starts on the 1st of January 2018, is better than preceding schemes, but it is far from perfect.

IT will be interesting to see how the line-up of new cars will change come January 2018, when the new Vehicular Emissions Scheme (VES) kicks in.

The VES, which metes out tax rebates or surcharges based on how environmentally sound (or unsound) a car is, is the latest attempt by the Government to nudge consumers towards cleaner choices.

This scheme dates back to 2001, when the Green Vehicle Rebate (GVR) was launched. It granted a 40 percent tax break to buyers of cars deemed cleaner than conventional petrol and diesel models.

Because it did not stipulate the emission levels, and its rebate was a flat percentage rate, the GVR led to a proliferation of high-end hybrid models, and then later, a slew of compressed natural gas cars – most of them poorly converted from petrol models.

Despite critism that the GVR was technology-biased, it took the Government more than a decade to revise it.

In 2013, the Carbon Emissions-based Vehicle Scheme (CEVS) replaced the Green Vehicle Rebate.

It meted out tax rebates and surcharges according to a vehicle’s carbon emission readings – regardless of its engine technology

The initial CEVS was relatively lax, and the majority of new cars on sale either qualified for rebates or fell into the neutral band (where neither rebate nor surcharge applied).

In 2015, the CEVS was made more stringent to encourage consumers and retailers to pick even cleaner models.

Despite that, the scheme has cost over $100 million in forgone taxes, an indication that the industry was still able to meet the CEVS carrot criterion fairly easily.

But things are expected to change come January.