Monday, May 20, 2013

Rethink on COE

Recently, articles have suggested that the government is starting to rethink on how COE can be redesigned in Singapore. Personally, I find that the COE does not fulfill it's objective of controlling the car population in Singapore and yet, give the average Singaporeans a chance to own a car. The current COE quota allows the rich to own one or several cars, while depriving those who has lesser capital to own one.

My first suggestion is to remove all the different categories for COE because nowadays, you have luxury cars in both COE categories. Instead, they should follow a system closer to HDB. For example, the COE pricing could be as follows:
  • Household income below $10,000 with no car: $x.
  • Household income below $12,000, and above $10,000 with no car: $x + 10%
  • Household with more than 1 car: An addition 10% for each additional car.

This will ensure that every Singaporean can have a chance of owning a car, and at the same time ensuring those with more than 1 car to pay more for this privilege.

My next suggestion is that to ensure that you do not have car sellers who hogs all the COE for the luxury buyers, you only buy the option to purchase when you get the COE (y% of $x). The option must be exercised within a month. I feel that this will help to stabalise the COE price.

If the 2 suggestions are implemented together, I feel that this is fairer than the current system, which I feel that favors the rich. Don't you think so?

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