COE Glossary
A comprehensive reference of every term, acronym, and concept you need to understand Singapore's vehicle ownership landscape — from ARF to VQS.
About This Glossary
This glossary covers over 30 terms related to Singapore's Certificate of Entitlement system, vehicle taxes, government schemes, and related concepts. Click any related term to jump to its definition. New to Singapore car ownership? Start with our What is COE? guide.
Additional Registration Fee (ARF)
A tax levied on all vehicles registered in Singapore, calculated as a percentage of the Open Market Value (OMV). The ARF is tiered: 100% for the first S$20,000 of OMV, 140% for the next S$30,000, and 180% for the remainder. It is one of the largest cost components when purchasing a new car in Singapore.
Bid Ratio
The ratio of total bids received to the number of COEs available in a particular bidding exercise. A bid ratio above 1.0 indicates more demand than supply, which typically pushes COE prices higher. Monitoring the bid ratio gives buyers an indication of how competitive the upcoming round may be.
CC Rating (Engine Capacity Rating)
A classification of vehicles based on their engine displacement measured in cubic centimetres (cc). In Singapore, the 1,600cc threshold is particularly significant as it divides Category A (≤1,600cc) and Category B (>1,600cc) for COE bidding purposes. LTA publishes annual vehicle population data grouped by CC rating bands (e.g. 1,000cc and below, 1,001–1,600cc, 1,601–2,000cc, above 3,000cc), which helps track the shift toward smaller, more efficient engines over time.
Carbon Emission-based Vehicle Scheme (CEVS)
The predecessor to the Vehicular Emissions Scheme (VES), CEVS offered rebates or imposed surcharges on new cars based solely on their carbon dioxide (CO2) emissions. Vehicles with low emissions received rebates of up to S$30,000, while high-emission vehicles faced surcharges. CEVS was replaced by VES on 1 January 2018 to include additional pollutant criteria.
Category A (Cat A)
COE category for cars with engine capacity up to 1,600cc and maximum power output of 97kW (130bhp). This is the most popular category for mass-market vehicles such as the Toyota Corolla, Honda Civic, and Hyundai Avante. Cat A typically has the highest number of bidders per round.
Category B (Cat B)
COE category for cars with engine capacity above 1,600cc or power output exceeding 97kW (130bhp). This covers larger and more powerful vehicles such as the BMW 3 Series, Mercedes-Benz C-Class, and Toyota Camry. Cat B premiums are generally higher than Cat A due to the types of vehicles competing in this segment.
Category C (Cat C)
COE category for goods vehicles and buses. This includes commercial vans, trucks, pick-ups registered as goods vehicles, and all buses. Cat C premiums tend to be significantly lower than Cat A and Cat B, as commercial vehicle demand follows different economic cycles.
Category D (Cat D)
COE category for motorcycles and scooters of all engine capacities. Cat D has the lowest COE premiums among all categories, typically ranging from S$5,000 to S$12,000. The motorcycle COE is valid for 10 years, the same duration as other categories.
Category E (Cat E)
The Open Category COE, which can be used to register any type of vehicle. In practice, Cat E is almost exclusively used for Cat B cars because it draws from a shared quota pool. Cat E premiums are almost always equal to or higher than Cat B, as it attracts bidders who want a Cat B COE but face stiff competition in that category.
Certificate of Entitlement (COE)
A licence required to register and own a vehicle in Singapore, valid for 10 years from the date of registration. COEs are obtained through a competitive sealed-bid auction held twice monthly by the Land Transport Authority. The system was introduced in May 1990 as part of the Vehicle Quota System to control Singapore's vehicle population and manage road congestion.
COE Bidding Exercise
The twice-monthly auction through which COEs are allocated to bidders. Each exercise runs for three working days, typically starting at 12pm on the first and third Monday of the month and closing at 4pm on Wednesday. It uses a sealed-bid, uniform-price format: bidders submit a reserve price (the maximum they are willing to pay), and the system automatically raises the price in S$1 increments until the number of remaining bidders equals the available COE quota. All successful bidders pay the same final price — the Quota Premium — regardless of their individual reserve prices.
COE Quota
The number of COEs made available for bidding in each exercise, set quarterly by LTA for each vehicle category. The quota is primarily determined by the number of vehicles deregistered in the preceding quarter, plus a small allowable growth rate (currently targeted at 0% net growth). A lower quota relative to demand pushes COE premiums higher. Quota figures are published before each quarter begins.
COE Rebate
A pro-rated refund of the COE premium when a vehicle is deregistered before its COE expires. The rebate is calculated as: (COE paid x remaining months of COE) / 120 months. For example, if you paid S$80,000 for a COE and deregister with 60 months remaining, you receive S$40,000 back. The COE rebate applies to both first-time and renewed COEs.
COE Renewal
The process of extending a vehicle's COE beyond the initial 10-year period. Owners can renew for either 5 or 10 years at the Prevailing Quota Premium (PQP) without needing to bid in an auction. A 5-year renewal costs 50% of the PQP. After renewal, the vehicle loses its PARF eligibility, meaning no PARF rebate is available upon eventual deregistration.
COE Transfer
The ability to sell or assign an unused COE to another person before it is used to register a vehicle. Only Category C and Category E COEs obtained by individuals are transferable, and each may only be transferred once. COEs in Categories A, B, and D are non-transferable. COEs obtained by companies in any category also cannot be transferred. In practice, COE transfers are uncommon because most buyers bid for a COE with a specific vehicle purchase already arranged.
COE Revalidation
The official LTA term for renewing an expiring COE. Vehicle owners can revalidate for either 5 years (at 50% of the PQP) or 10 years (at the full PQP). Revalidation data, published monthly by LTA, tracks how many vehicles have their COEs renewed instead of being scrapped or exported. A high revalidation rate can reduce the supply of COEs available for new vehicles, as fewer vehicles leave the road.
Depreciation
The loss in value of a vehicle over time, and the single largest cost component of car ownership in Singapore. Depreciation is commonly calculated as: (purchase price − scrap or resale value) ÷ years of ownership. It is heaviest in the first three years and stabilises from years four to eight. PARF and COE rebates recovered upon deregistration reduce the effective depreciation. Depreciation is the most important number when comparing the true cost of different cars or deciding when to sell.
Deregistration
The formal process of removing a vehicle from Singapore's vehicle register, ending the right to use it on public roads. Upon deregistration, the owner may receive PARF and COE rebates depending on the vehicle's age and COE status. The vehicle must then be scrapped locally, exported, or converted to an off-road vehicle within a specified timeframe.
Electric Vehicle (EV)
A vehicle powered entirely by one or more electric motors using energy stored in rechargeable batteries. EVs produce zero tailpipe emissions and qualify for the highest VES rebates in Singapore. EV adoption has accelerated rapidly — as of 2025, electric cars account for over 60% of new car registrations. Popular EV brands in Singapore include BYD, Tesla, and Hyundai. EVs pay road tax based on power rating (kW) rather than engine capacity (cc).
EV Early Adoption Incentive (EEAI)
A government incentive introduced in 2021 to encourage the adoption of electric vehicles in Singapore. The EEAI provides a rebate on the Additional Registration Fee (ARF) for electric cars and taxis. In 2026, the rebate is 45% of the ARF, capped at S$7,500 (down from S$15,000 in prior years). The EEAI will cease after 31 December 2026. Combined with VES rebates, electric car buyers can save up to S$30,000 off the ARF in 2026. A S$0 ARF floor for EVs is maintained until end of 2027.
Electronic Road Pricing (ERP)
Singapore's congestion pricing system that charges motorists a toll when passing through gantries located on congested roads and expressways during peak hours. Charges vary by location, time of day, and vehicle type. The system was introduced in 1998, replacing the original Area Licensing Scheme. ERP rates are reviewed quarterly and adjusted to maintain optimal traffic flow.
ERP 2.0
The next-generation Electronic Road Pricing system that replaces physical gantries with satellite-based (GNSS) tracking via an On-Board Unit (OBU) installed in every vehicle. ERP 2.0 enables distance-based and time-based congestion pricing, offering greater flexibility than the gantry model. The system is being phased in from 2025, with all vehicles required to install the new OBU.
Excise Duty
A customs duty of 20% levied on the Open Market Value of all motor vehicles imported into Singapore. Excise duty is collected by Singapore Customs at the point of importation and is included in the overall cost of the vehicle before the Additional Registration Fee is calculated. Together with GST and ARF, it forms a significant portion of the vehicle's total on-the-road price.
Guaranteed COE Package
A pricing arrangement offered by authorised car dealers in which the dealer guarantees to secure a COE at a fixed price within a stated period, regardless of how COE prices move in subsequent bidding rounds. If the actual COE price turns out higher, the buyer pays no top-up. If it falls below the guaranteed price, the buyer receives a COE rebate for the difference. By contrast, a Non-Guaranteed COE package is typically cheaper upfront but carries the risk that the buyer must top up if COE prices rise, or wait longer if the dealer's bid is unsuccessful.
Goods and Services Tax (GST) on Vehicles
The Goods and Services Tax applied to motor vehicles in Singapore at the prevailing rate of 9% (as of 2024). GST is charged on the total value of the vehicle including OMV, excise duty, and other costs, but excluding the COE premium and ARF. GST adds to the overall purchase cost and is non-refundable for private vehicle owners.
Importer Type (Authorised Dealer vs Parallel Import)
Vehicles in Singapore are brought in by two types of importers. Authorised Dealers (ADs) are officially appointed by the car manufacturer and typically offer full factory warranty, after-sales support, and access to genuine parts. Parallel Importers (PIs) source vehicles independently — often at lower prices — but may offer different warranty terms. LTA registration data tracks both channels, and PI market share has grown significantly as buyers seek value, especially for popular models like Toyota and Honda.
In-vehicle Unit (IU)
An electronic transponder installed in every vehicle registered in Singapore, used to deduct ERP charges automatically when the vehicle passes through ERP gantries. The IU accepts a CashCard or EZ-Link card for payment. With the rollout of ERP 2.0, the IU is being replaced by a new On-Board Unit (OBU) that uses satellite-based positioning.
Loan-to-Value Ratio (LTV)
The maximum percentage of a vehicle's purchase price (including COE) that a financial institution can lend to a buyer, as regulated by the Monetary Authority of Singapore (MAS). For vehicles with an OMV of S$20,000 or below, the maximum LTV is 70% (minimum 30% downpayment). For vehicles with an OMV above S$20,000, the maximum LTV is 60% (minimum 40% downpayment). These limits apply to all banks and licensed lenders in Singapore and cannot be exceeded.
Land Transport Authority (LTA)
The Singapore government statutory board responsible for planning, operating, and maintaining the country's land transport infrastructure and systems. LTA oversees the COE bidding system, vehicle registration, road network, public bus and rail systems, and cycling infrastructure. It is the primary authority that administers the Vehicle Quota System.
Motor Vehicle Loan Tenure
The maximum duration of a car loan in Singapore, capped at 7 years by the Monetary Authority of Singapore (MAS). This applies to all motor vehicle loans from banks and finance companies. A longer tenure reduces monthly repayments but increases the total interest paid over the life of the loan. Most buyers choose 5 to 7 years to keep monthly payments manageable given the high cost of vehicle ownership in Singapore.
New Registrations
The monthly count of newly registered vehicles in Singapore, broken down by VQS category. New registration figures serve as the primary demand-side indicator for the COE market — when registrations are high relative to quota, COE premiums tend to rise. LTA publishes this data monthly, and it is closely watched by analysts to forecast future COE price movements. Registration data also includes breakdowns by car make, fuel type, and importer type.
Non-PARF Car
A vehicle whose COE has been renewed beyond the initial 10-year period, making it ineligible for a PARF rebate upon deregistration. Non-PARF cars are generally older vehicles (over 10 years) and are less expensive to purchase because buyers cannot recover any PARF rebate. When you deregister a non-PARF car, you only receive the pro-rated COE rebate.
Off-Peak Car (OPC)
A vehicle registration scheme that offers a S$17,000 rebate on the ARF in exchange for restricting usage to off-peak hours: weekday evenings (7pm to 7am), weekends, and public holidays. OPC vehicles display a red licence plate. Owners can purchase a daily licence to drive during peak hours. The scheme is also known as the "Weekend Car" scheme.
Open Market Value (OMV)
The price of a vehicle as assessed by Singapore Customs before any taxes, duties, or registration fees are applied. OMV includes the purchase price, freight, insurance, and all costs to bring the vehicle to the port of Singapore. It forms the base on which the Additional Registration Fee (ARF), excise duty, and GST are calculated, making it a critical factor in the total cost of vehicle ownership.
PARF Car
A vehicle that is still within its first 10-year COE period and therefore eligible for a PARF rebate upon deregistration. PARF cars are more valuable in the used car market because the buyer can recover a portion of the ARF if they deregister the vehicle. The PARF rebate decreases each year: 75% of ARF in years 1-5, then reducing to 50% by year 9, and 0% after year 10.
PARF Rebate (Preferential Additional Registration Fee)
A rebate of the Additional Registration Fee returned to the owner when a PARF-eligible vehicle is deregistered within its first 10 years. The rebate is tiered based on the vehicle's age: 75% for years 1-5, 70% for year 6, 65% for year 7, 60% for year 8, 55% for year 9, and 50% for year 10. Since 2023, the PARF rebate has been capped at S$60,000.
Prevailing Quota Premium (PQP)
The three-month moving average of COE Quota Premiums for a given category. The PQP is used as the renewal price when vehicle owners choose to extend their COE without bidding in an open auction. It is recalculated after each bidding round, so it fluctuates with recent COE prices. Renewing for 5 years costs 50% of the PQP, while a 10-year renewal costs the full PQP.
Reserve Price
The maximum amount a bidder is willing to pay for a COE in a bidding exercise. When submitting a bid, the bidder sets a reserve price (minimum S$1, in whole-dollar increments). The automated system bids on the bidder's behalf up to this amount. If the rising current price exceeds the reserve price, the bid is eliminated. Bidders may revise their reserve price upward during the exercise but cannot lower it. The reserve price is confidential — only the final Quota Premium (the lowest winning bid) is publicly disclosed.
Red Plate
The distinctive red licence plate displayed on Off-Peak Cars (OPC) and Weekend Cars in Singapore. Red plate vehicles enjoy a lower ARF but are restricted from driving during weekday peak hours (7am to 7pm) unless the owner purchases a daily licence. The red plate makes it easy for enforcement cameras and traffic police to identify restricted vehicles during peak periods.
Registration Fee
A flat fee of S$220 charged by LTA for the registration of a new vehicle in Singapore. This is a relatively minor cost compared to the COE, ARF, and excise duty, but it is a mandatory part of every vehicle registration. The fee covers the administrative cost of processing the registration and issuing number plates.
Road Tax
An annual tax that all vehicle owners in Singapore must pay to keep their vehicles legally on the road. Road tax is calculated based on engine capacity for petrol and diesel vehicles, and power rating for electric vehicles. Rates are progressive: higher-capacity engines pay significantly more. Road tax can be paid in 6-month or 12-month instalments and is collected by LTA.
Scrapping
The physical destruction of a deregistered vehicle at an LTA-authorised scrapyard. When a vehicle is scrapped, the owner receives any applicable PARF and COE rebates. Scrapping is one of three options upon deregistration (the others being export and off-road storage). The scrapyard handles the logistics and LTA paperwork on behalf of the owner.
SGCM (Singapore Car Market)
A widely-used online platform and resource for the Singapore automotive market. SGCM provides car listings, dealer directories, car reviews, and automotive news. It is one of several popular portals (alongside sgCarMart and Motorist) that Singaporeans use to browse new and used car prices, compare deals, and access vehicle-related information.
Total Cost of Ownership (TCO)
The all-in cost of owning and operating a vehicle over its entire ownership period. TCO includes depreciation (the largest component), COE premium, ARF, road tax, insurance, fuel or electricity, parking, maintenance, and servicing. For a mid-range car in Singapore, TCO typically works out to S$1,700–S$2,100 per month over 10 years. TCO is the most meaningful way to compare the true cost of different vehicles, as it captures recurring expenses that the sticker price alone does not reflect.
Total Debt Servicing Ratio (TDSR)
A borrowing limit imposed by the Monetary Authority of Singapore (MAS) that caps a borrower's total monthly debt repayments — including mortgage, car loan, credit cards, and other obligations — at 55% of their gross monthly income. TDSR applies to all vehicle loans and means that even if a buyer meets the LTV downpayment requirement, their loan may still be reduced if their existing debts are high. Buyers should factor TDSR into their budget before committing to a car purchase.
Temporary COE (TCOE)
A 6-month COE issued to buyers who have purchased a vehicle but are awaiting the outcome of a regular bidding exercise. The TCOE allows the vehicle to be registered and driven while the permanent COE is being secured. If the bid is unsuccessful, the TCOE can be extended or the vehicle must be deregistered.
Vehicle Population
The total number of vehicles registered and in use on Singapore's roads at any given time, tracked monthly by LTA and broken down by VQS category. As of 2025, Singapore's total vehicle population is around 970,000. The government maintains a near-zero vehicle growth rate policy, meaning the population is kept roughly constant — new registrations are offset by deregistrations. Vehicle population data is a key input for transport planning and COE quota calculations.
Vehicle Growth Rate
The annual rate at which the government allows Singapore's vehicle population to grow, set by the Ministry of Transport. Since February 2018, the growth rate has been 0% for cars and motorcycles, meaning the total number of these vehicles on the road is kept roughly constant — every new registration must be offset by a deregistration. Commercial vehicles (Category C) are allowed 0.25% annual growth. In October 2024, LTA announced a one-off injection of approximately 20,000 additional COEs from February 2025 over several years, citing reduced vehicle mileage post-COVID and the rollout of ERP 2.0.
Vehicle Quota System (VQS)
The overarching government policy framework that controls Singapore's vehicle population growth. Under the VQS, the total number of vehicles allowed on the road is regulated through COE quotas set quarterly by LTA. The quota is determined by the number of vehicles taken off the road (deregistered) plus a small allowable growth rate. The VQS has been in effect since May 1990.
Vehicular Emissions Scheme (VES)
A scheme that imposes surcharges or grants rebates on newly registered vehicles based on their exhaust emissions across multiple pollutants: carbon dioxide (CO2), hydrocarbons (HC), carbon monoxide (CO), nitrogen oxides (NOx), and particulate matter (PM). Clean vehicles (Band A1/A2) enjoy rebates of up to S$25,000, while pollutive vehicles face surcharges of up to S$25,000. VES replaced CEVS in 2018.
Weekend Car
Another name for the Off-Peak Car (OPC) scheme. Weekend Cars display red licence plates and enjoy a S$17,000 ARF rebate but are restricted to off-peak usage. The term "Weekend Car" is commonly used because owners primarily drive these vehicles on weekends and public holidays. It remains a popular option for car enthusiasts who do not need a car for daily commuting.
Zero Emission Vehicle (ZEV) Mandate
Singapore's policy goal, announced under the Singapore Green Plan 2030, for all new car and taxi registrations to be cleaner-energy models by 2030. The mandate is supported by incentives such as the Vehicular Emissions Scheme (VES) and the EV Early Adoption Incentive (EEAI), expanded EV charging infrastructure (targeting 60,000 charging points by 2030), and progressively higher surcharges on pollutive vehicles. The ZEV mandate provides the long-term policy context for the rapid shift toward electric vehicles visible in Singapore's registration data.