The Land Transport Authority has released news it will start to implement a progressive COE system where a single owner may be tax more for multiple car ownership. This is a good move but of course unwelcome by the rich – who happens to be foreigners or expatriates here leeching off Singapore’s labor exploitative climate.
A progressive COE is only part 1, and it is useless if it is not implemented along with the following:
Part 2 is to differentiate COE between citizens, permanent residents and foreigners. LTA refuse to declare the percentage composition of the nationality of the COE owners because they know the lowering percentage of Singaporean car owners is a contentious issue – especially in the midst of an overcrowded situation like in Singapore. Singaporean citizens with young children or elderly should get higher tax rebates or even exempted COE, from the extra taxes levied on the rich for possessing multiple cars.
Part 3 is to remove the ERP, and revamp the COE system under one quota system where the vehicle type becomes a multiplier of an index price instead of having several categories. Example: Taking motorcycles have the index price at $1000. Class A becomes a 50 times multiplier, while Class B becomes a 60 times multiplier. The justification to such multipliers is to ensure that today’s situation [Source] where the rich pay lesser taxes for luxury cars than the middle class who could only afford a Toyota in the Class A(below 1600cc) category.
Part 4 is to reduce the population figure and expand suburb towns like Punggol, Yishun and Chua Chu Kang. The old land use strategy must be abandoned – offices must not always be in the central(even though factories should of course remain near the coastlines away from towns)
The implementation of part 1 is always a cause for concern because if the progressive tax is just 10 or 20%, or about $1000 in absolute, the extra tax is negligible and will not deter the rich from possessing more cars. We should be looking at 50% tax hike for the 2nd car, and 50% higher for the total of the 1st and 2nd car. We at Wiki Temasek also recommend that the progressive COE be classified to a household address instead of just a single owner, because the impact will be negligible. Chances are the PAP government is merely going to implement a slap on the wrist for the rich, and the same problem of the rich owning multiple cars continue simply because the tax hike is negligible.
*Article first appeared on my blog at WikiTemasek.org