Car buyers want COE system reviewed

[yeokiwi]

I actually suggested that each household with a child or elderly be allocated a COE. Then they can choose to sell it or use it. And child bearing/ parental policy incentive can be adjusted as well, for eg 2 parents staying with you, you get additional COE.

This serves 2 purposes: reallocating money to families that contribute to societal needs, and people cannot complain they don't have a choice in car ownership. And govt don't have to "pay" a cent. Downside is of course fiscal revenue Big Grin

http://www.singstat.gov.sg/stats/keyind.html#hhld
According 2011 statistics, there are a total of 1.1 million households.

http://www.singstat.gov.sg/pubn/referenc...opic11.xls
and according to the above statistics, there are 945,829 vehicles on road.(car+taxi+bus+good vehicles+...)

Can the plan work??

[specuvestor]

It can be tweaked. We can start allocating COE to those with 2 elderlies or >3 kids. Kids are more straightforward but as usual we need to have enforcement checks or penalties on those claiming to live with their parents

From another perspective, with 1 mio vehicles with average COE of say $60,000 over 10 years average we are actually spending $60b on vehicle ownership. This cost has to be allocated somewhere. 羊毛出在羊身上。 This is a real strain and threat to our competitiveness, together with housing inflation. In short asset inflation in free market system is doing its grind on us.

[yeokiwi]

Good to hear that. So can you just tell us your idea/ideas? Then may be more people who care about making our society more equitable will be encourage to participate. If we all can't reach a suitable idea, so be it. At least no one can say we didn't try. No use just talking and complain about it. It won't change a thing,. Will it? i may be an ignoramus but i know and can see what is equitable and what is not.

I have no feasible idea and I am not interested to write down ideas that I think that will not work and I am not the one that is complaining about COE.
A simple search in Internet will easily throw up many infeasible ideas and analysis.
http://sghardtruth.com/tag/coe/

[bookworm]

Frankly, Singapore has the most comprehensive vehicle tax system. The current state is due to demand supply mismatch.

Let's take a step back and look at the various taxes and fees levied on a car:
[1] New car
(a) Excise duties (to show the rest of the world our custom tax is low)
(b) ARF (Govt fees for administering the car)
© COE (Owner choice on how much he wishes to pay, see, govt passed the decision to buyer, not govt choice)

[2] Keeping a car
(a) Road tax standard tax by govt based on vehicle types)
(b) Petrol tax (based on usage, regardless of vehicle types)
© ERP (this is a location tax to manage congestion)
(Carpark & Insurance not included since they are not tax)

The part about imposing tax on rich people should not be based on COE system. The rich consume more, paid more GST - thus fair. If need to tax the rich more, can easily raise income tax or property tax. Market will find its own equilibrium after that. Not through COE.

The present uneven distribution of COE quota per year is due to the tweak in ARF system in 2002 and 2004, resulting in many cars with high COE being de-registered between 2002 to 2006, and thus high quota during this period. If you recall, Singapore has the highest percentage of new cars then. Of course, the recent reduction in quota, no incentive to de-register cars squeezed supply and impacted on the COE price.

The solution is straight forward. The bunch of highly paid and smart admin officers at LTA can easily implement this, not sure what they are busy with...

Solve from first principle, just even out the vehicle quota! Simple solution can be:
[1] Determine the average new vehicle to be given per year
[2] Buy back excess COEs above average, typically those expiring in 2014~2016 at prevailing COE (or a formula to be decided) less a discount (say 25%) for admin / handling. This is a tweak from existing, that is based on actual COE paid for the car. The proposal is likely attract a queue to sell, LTA need to have a fair system to ballot whose car to de-register...
[3] Allocate COE purchased back to monthly COE quota for bidding

Number of vehicles on road remain the same, govt pocket an admin fee. COE reduce, everyone happy. The admin officer to implement this could be promoted too. But, most importantly, it solves the root of problem. Otherwise, come 2015, people de-register their cars bought these 2 years to cash out COE and worsen the situation further...

[freedom]

supply is beyond demand partially because people are rich and the cars are cheap. So COE must do the trick.

[bookworm]

supply is beyond demand partially because people are rich and the cars are cheap. So COE must do the trick.

COE lever is not intended for the rich. Increase income tax, increase road tax for higher engine capacity cars if need to to address the rich having too much disposable income. Most importantly, LTA must even out the yearly supply to solve the root of problem.

[freedom]

supply is beyond demand partially because people are rich and the cars are cheap. So COE must do the trick.

COE lever is not intended for the rich. Increase income tax, increase road tax for higher engine capacity cars if need to to address the rich having too much disposable income. Most importantly, LTA must even out the yearly supply to solve the root of problem.

the road can't be built in short time, so what can LTA do?

[bookworm]

Simple, buyback COEs expiring in 2014~16 and re-issue as new quota for 10 years to even out supply. Total vehicle population remains unchanged.

[violinist]

How is it that housing can be controlled (while you can buy as many private houses as you can, you cannot own more than 1 HDB flat, whether it is subsidized or from open market, because, as we understood, HDB provides housing for the masses in land scarce Singapore. And your income determines or restricts the type of HDB flat that you can buy) while cars cannot? (or is it don't want to control?)

[freedom]

How is it that housing can be controlled (while you can buy as many private houses as you can, you cannot own more than 1 HDB flat, whether it is subsidized or from open market, because, as we understood, HDB provides housing for the masses in land scarce Singapore. And your income determines or restricts the type of HDB flat that you can buy) while cars cannot? (or is it don't want to control?)

since when, car becomes as important/necessary as house?

in that case, i would like everything(good/expensive) to be offered the same way....

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Simple, buyback COEs expiring in 2014~16 and re-issue as new quota for 10 years to even out supply. Total vehicle population remains unchanged.

your solution is highly unfair to owners of expiring COE. You rob their chances of owning a car cheaper now and going to own a car cheaper in 2014 - 2016(more COEs coming, they have the best luck). Now, they have to bid high high with the rest.

If it is not fair, it won't get started.