It is unfair to pay COE in installments

Media Replies
1 Mar 2008

We refer to Madam Hamidah Jaafarn's letter "Can't afford to renew COE" (Berita Harian, 20 February 2008).

The Vehicle Quota System (VQS) is part of a package of measures to regulate the growth of vehicle population to ensure that our roads remain congestion free. Those who wish to own a vehicle must pay for a Certificate of Entitlement (COE), which will allow them to use the vehicle for up to 10 years.

A COE represents an up-front lump sum cost to vehicle owners, and all should be competing for the limited number of such COEs on the same basis. To allow existing owners to renew their COEs on an instalment basis would be unfair to new vehicle buyers who have to pay the full amount of a 10-year COE upfront. To be fair to all road users, be it existing vehicle owners and prospective/new owners, is an important consideration in the design of the VQS.

Vehicle owners are required to renew the 10-year COE for their vehicle before the COE expires if they wish to continue using the vehicle. If the COE for the vehicle is not renewed by its expiry date, the vehicle will be de-registered. The vehicle owner may apply to reinstate the COE within one month after the COE expires, subject to the payment of the applicable Prevailing Quota Premium (PQP) and late payment fee. The vehicle cannot be used until the COE and road tax are renewed.

If Madam Hamidah Jaafarn's husband feels that his vehicle cannot last beyond five years, he may wish to consider renewing the COE for five years instead. However, the 5-year COE comes with the condition that upon its expiry at the end of five years, the vehicle must be de-registered and taken off the roads permanently, i.e. the 5-year COE cannot be further renewed.