On 8 October 2026, the Land Transport Authority (LTA) opened a public consultation on a COE Category A and B merger. All passenger cars would bid for COEs from one pool, and each car would then get a rebate, a surcharge or no change on that single COE price. The median open market value (OMV) of its model would decide which. It is a preliminary proposal. LTA is taking views until 11.59pm on 2 November 2026, expects to finish its review by the end of 2026 and will share its findings by the first half of 2027.
Today, Category A COEs are for cars of up to 1,600cc and 130bhp, or electric cars of up to 110kW. Since 2014, engine capacity and power have separated these mass-market cars from the higher-value cars in Category B. LTA says electric cars have made that line less effective, because makers can adjust a car's specifications to fit within the Category A limits.
As a result, more buyers compete for Category A COEs. From February to June 2026, the Category A price was higher than Category B three times. In the 7 October COE bidding exercise, Category A closed at S$130,001 and Category B at S$130,100.
Under the proposal, every car buyer would bid from the same pool and there would be one COE price. LTA says prices would still be set by market forces. The Straits Times spoke to 11 motor dealers, and they do not expect the change to bring COE prices down. Ng Lee Kwang, a motor trade veteran of over 30 years, expects dealers to need a few bidding rounds to settle on the right COE price if the changes go ahead.
LTA has put two band structures out for feedback. In both, buyers of lower-value cars get a rebate, mid-range cars see no adjustment and buyers of higher-value cars pay an extra fee on top of the prevailing COE price.
Either way, a buyer in the lowest band and a buyer in the highest band would pay S$30,000 apart on the same COE price. Three bands are simpler to run, but the jump between neighbouring bands is bigger. Five bands give smaller steps between similar cars, with a more complex process behind them.
| Option | Band and OMV percentile | Adjustment to the COE price |
|---|---|---|
| Three bands | Band 1, 0 to 35th | S$15,000 rebate |
| Three bands | Band 2, 35th to 50th | No adjustment |
| Three bands | Band 3, above 50th | S$15,000 surcharge |
| Five bands | Band 1, 0 to 10th | S$15,000 rebate |
| Five bands | Band 2, 10th to 35th | S$7,500 rebate |
| Five bands | Band 3, 35th to 50th | No adjustment |
| Five bands | Band 4, 50th to 75th | S$7,500 surcharge |
| Five bands | Band 5, above 75th | S$15,000 surcharge |
OMV is a car's price before taxes. LTA would line up the OMVs of past registrations of each model, take the median and use it to place the model in a band by percentile. The Straits Times reported that LTA would refer to cars registered in the previous year. Bands would be reviewed and published every year, and car retailers could appeal a band.
LTA's examples show where common models would sit. In the three-band option, the Toyota Sienta, Honda Freed, Nissan Note and Mazda 3 fall in the rebate band. The Audi A3, Toyota Corolla Altis and Nissan Serena see no adjustment, and the Mercedes-Benz A180, Tesla Model 3 RWD 110 and Toyota Alphard pay the surcharge.
Dealers told The Straits Times the method raises questions. Ron Lim of Tan Chong Motor Sales said OMV moves with exchange rates and supply chains, and a parallel importer can bring in a model at a lower OMV than an authorised dealer, which lowers its median. Adelene Tan of Vantage Automotive asked how a facelifted model would be banded when new equipment changes its OMV. Lee Hoe Lone of Premium Automobiles said dealers could bring in EVs with smaller batteries to cut OMV, with a range of about 300km instead of about 400km.
LTA is asking whether the feebate should also apply when owners renew a COE. Gina Koh, whose COE expires at the end of 2027, told The Straits Times there was no rush, since it is unclear whether COE renewals will change. Koh wants to see whether renewing or buying a new car makes more financial sense.
LTA also wants views on Category E, the open category. It draws its quota from Categories A, B and C, and in recent years most Category E COEs have gone to Category B cars. One option is to remove it to simplify the system. The other is to keep it for cars only, so buyers who need a car urgently still have a route without taking COEs from Category C.
Separate from the COE review, LTA and NEA announced in September 2025 that the EV Early Adoption Incentive would stop from 1 January 2027. For electric cars registered in 2026, it takes 45% off the Additional Registration Fee (ARF), capped at S$7,500. With the Vehicular Emissions Scheme (VES), electric cars registered in 2026 get combined savings of up to S$30,000 off the ARF, and those registered in 2027 up to S$20,000.
Mazda Singapore managing director Jason Lim told The Straits Times that smaller EV incentives and higher penalties for non-EVs from 1 January mean cars will cost more after 2026, even if the COE price stays the same. The Mazda 3, for example, will carry a S$7,500 VES surcharge, up from S$0 now. The newspaper also reported that some buyers are eyeing a purchase before the current rebate schemes end.
LTA's consultation sets out how each group would be treated if the proposal goes ahead.
The consultation closes at 11.59pm on 2 November 2026. You can read the full paper on REACH and send your views at go.gov.sg/coe-pcd-feedback, or post a hard copy to LTA's Policy Division (Private Transport), 1 Hampshire Road, Singapore 219428.
LTA says COE prices would continue to be set by market forces. The 11 motor dealers The Straits Times spoke to do not expect the proposed changes to bring COE prices down.
In both options, the lowest band gets a S$15,000 rebate and the highest band pays a S$15,000 surcharge on the prevailing COE price. The five-band option adds S$7,500 rebate and surcharge bands, and mid-range cars see no adjustment.
That is one of the questions in the consultation. LTA is asking the public whether the feebate should apply to COE renewals, and will share its findings and recommendations by the first half of 2027.
Send your views at go.gov.sg/coe-pcd-feedback before 11.59pm on 2 November 2026, or mail a hard copy to LTA's Policy Division (Private Transport), 1 Hampshire Road, Singapore 219428.
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