$154,000 For A Prius? Here’s Why Cars Are Ridiculously Expensive In Singapore

Offbeat

In Singapore, luxurious cars like the Porsche Taycan can cost nearly $610,000, and even normal family cars like the Toyota Prius still cost over $100,000. But why is that the case? This video by Kuma Kuruma answers that question, and the reasoning is actually more straightforward than you might think.

Using the Volkswagen Polo as an example, he begins by explaining the Open Market Value, or OMV. The OMV is the price of the car before any taxes or fees are applied. In the case of the Polo, that would be $17,796 SGD ($13,423 USD). Next up is the Excise Duty, which is an additional tax amounting to 20 percent of the OMV. The Polo’s Excise Duty is $3,559 SGD ($2,684 USD). Then there’s the Goods & Services Tax (GST), another tax amounting to 7 percent of the combined total of the Excise Duty and the OMV. The Polo’s GST is $1,494 SGD ($1,127 USD).

See Also: This Is How Some Dealers Are Stocking Up On Used Vehicles

After that, there’s the Additional Registration Fee (ARF), which is the worst one yet. The magnitude of the fee works on a bracket system, and for cars with a $20,000 SGD OMV and under, you’re paying an extra 100 percent of the OMV on top of the original OMV, Excise Duty, and GST. For cars with an OMV between $20,001 and $50,000 SGD, you pay an extra 140 percent of the OMV on top of the original OMV, Excise Duty, and GST. Finally, for cars with an OMV over $50,000 SGD, you pay an extra 180 percent of the OMV on top of the original OMV, Excise Duty, and GST. Not just that, but options are taxed individually, bringing the vehicle’s cost up even more.

Since the Polo’s OMV is just $17,796 SGD ($13,423 USD), its ARF would “only” be another $17,796 SGD ($13,423 USD) on top of that. Combined with the $3,559 SGD ($2,684 USD) Excise Duty and the $1,494 SGD ($1,127 USD) Goods & Services Tax, that brings the total cost of this sub-$20k Polo to $40,646 SGD ($30,658 USD), or more than double the price of the original car.

Read More: Organizers Cancel The F1 Singapore GP For 2021 Citing Covid-Related Concerns

However, it doesn’t end there. At this point, you’ve bought the car, but there’s still one more thing you need before you can drive it: the Certificate of Entitlement (COE), which allows you to drive your newly acquired vehicle for up to 10 years. The COEs are limited in supply, so pricing can vary from month to month, and which type of COE you need varies based on your car. For the Polo, one of these certificates would go for about $48,000 SGD ($35,669), in this case more. At this point, our sub-$20k Polo now costs around $99,000 SGD ($74,600 USD), or nearly four times the price of the original car.

So in the end, while the cars themselves are initially relatively affordable in Singapore, it’s all the compounding taxes and fees that drive the prices up to such exorbitant amounts. For a more in-depth breakdown of the whole system, you can check out Kuma Kuruma’s video below.

Products You May Like

Articles You May Like

Nissan CEO reassures France’s Macron over Renault alliance
Tesla profit surge driven by record car deliveries
2022 Hyundai Accent
Car-sharing firm Getaround to pay D.C. $950K for operating without a license
Musk says India plant likely if Tesla succeeds in importing cars there

Leave a Reply

Your email address will not be published. Required fields are marked *