Singapore's EV Incentives Are Changing - Here’s What You Need to Know!

In an exciting yet daunting update for car enthusiasts, the Land Transport Authority (LTA) and National Environment Agency (NEA) have revealed crucial changes to electric vehicle (EV) incentives that could affect your wallet. While two popular green schemes will continue, the benefits are shrinking—find out how it impacts you!

What Are VES and EEAI?

The Vehicular Emissions Scheme (VES), initially launched in 2018, provides potential car buyers with financial rebates or surcharges based on their vehicle's emissions. The Electric Vehicle Early Adoption Incentive (EEAI) is also there to encourage cleaner-energy vehicles. While both schemes are being extended—VES now running until December 31, 2027, and EEAI lasting until December 31, 2026—significant revisions are on the horizon.

How Will These Changes Affect Your Next Car?

Starting in 2026, buyers of electric vehicles could see their rebates significantly reduced. For example, a BYD Atto 3 valued at S$31,500, which currently has no ARF after rebates, will have a S$6,100 ARF. Similarly, a base-level Tesla Model 3, currently costing S$17,210 after rebates, could jump to S$27,210, netting you a whopping S$10,000 increase! This could mean a substantial hit to savings for many prospective EV buyers.

Why Lower the Incentives?

The LTA and NEA cite the narrowing cost gap between electric vehicles and traditional combustion engines as a reason for these cuts. An incredible 80% of new car registrations from January to August 2025 were cleaner energy models, with half of them being electric. As Singapore moves closer to its goal of 100% cleaner energy vehicles by 2040, the need for high rebates diminishes.

What About Car Prices and COE Premiums?

Expect a short-term spike in Certificate of Entitlement (COE) prices, with analysts advising potential buyers to tread carefully on bids. Transport analyst Walter Theseira has pointed out that uncertainty surrounding EV rebates is making car shoppers rush their purchases, driving COE prices to record highs. Recently, COE premiums for smaller cars hit S$107,889—surpassing previous records.

Is It Time to Buy or Wait?

While the new rebates may deter some buyers, the situation isn't dire for everyone. Many best-selling Chinese EV models, with an ARF below S$30,000, remain unaffected by the reduction. If your future ride falls within this category, the real question is whether you need to rush your purchase or wait for more clarity—there’s potential for savings regardless!

As the EV landscape in Singapore evolves, understanding these changes can make all the difference in your next vehicle purchase. Stay informed and plan wisely!