- From 1 January 2027: On-board Units will be mandatory for all Singapore-registered vehicles; Missed ERP charges to be decriminalised
- From 27 February 2026: Enhanced penalties for Vehicle Safety
On-Board Units (OBU) to be mandatory for all Singapore-registered vehicles
From 1 January 2027, the Land Transport Authority (LTA) will transition to use the ERP 2 system for road use charging, and all Singapore-registered motor vehicles must have the ERP 2 system’s On-Board Unit (OBU) installed to travel on public roads in Singapore.
2. As of 31 January 2026, about 930,000 vehicles, or more than 93% of vehicles in Singapore, have been installed with an OBU at one of the more than 300 authorised workshops across the country. We are on track to complete the installation exercise in 2026.
3. From 15 February 2026, vehicle owners who have been invited to install the OBU but have yet to do so will receive a final reminder from LTA. They will be given the next three months from the date of issuance of the final reminder to install the OBU for free. After which, they will need to pay $35 and $70 for the installation of OBU in motorcycles and all other vehicles, respectively.
4. Unauthorised persons should not offer OBU-related services such as installation, manufacture, modification, repositioning, removal, repair, and advertising. For serious cases of non-installation, tampering or unauthorised OBU services, the legislation provides for penalties of up to $20,000 or imprisonment for a term not exceeding 12 months, or both.
5. MOT and LTA will exempt certain vehicles[1] from the installation of the OBU. Existing Classic or Vintage Vehicle (CVV) owners have the option to install a free OBU if they prefer, subject to technical feasibility assessment by the workshop. From 1 January 2027, CVV vehicles that do not have the OBU installed will be able to pay a flat-rate ERP fee ($3 for motorcycles; $10 for all other vehicles) for every ERP operational day that the vehicle travels on Singapore roads.
Streamlined collection of missed ERP charges
6. To streamline the collection of missed ERP charges, LTA will decriminalise missed ERP payments and treat them as an administrative matter. Today, unpaid missed ERP payments can lead to prosecution in Court as a traffic offence if left unsettled.
7. From 1 January 2027, vehicle owners, rather than drivers, will be responsible for settling outstanding ERP charges. Vehicle owners who fail to do so within the grace period of five days from LTA’s SMS notification will be unable to transact with LTA, until the missed charge and a $10 administrative fee are paid. (Please see Annex A).
8. Vehicle owners who do not settle outstanding ERP payments within the grace period will be denied access to the following vehicle services:
· Renewal of road tax (issuance of licence);
· Use and encashment of Preferential Additional Registration Fee (“PARF”) rebate and Certificate of Entitlement (“COE”) residual;
· Application to transfer the registration of the vehicle;
· Refund of Off-Peak Car rebates;
· Refund of unused road tax; and
· Refund of road tax rebates for school buses.
Enhanced penalties for vehicle safety
9. Penalties for illegal alteration of motor vehicles, and for keeping or using unregistered/deregistered vehicles have also been enhanced to strengthen deterrence and improve vehicle and road safety.
10. Increasing penalties for illegal alteration of motor vehicles aims to deter workshops from permitting[2] such illegal alterations on their premises. Individuals face fines of up to $20,000 or imprisonment for a term not exceeding two years or both. Penalties are doubled for repeat offenders. For non-individuals, first time offenders can be fined up to $40,000 and $80,000 for repeat offenders.
11. Penalties for keeping or using unregistered/ deregistered vehicles have also been enhanced to be commensurate with the severity of such an offence. Offenders can be fined up to $20,000 and/or jailed up to two years for the first offence, with penalties doubled for repeat offenders.
12. The enhanced penalties will take effect from 27 February 2026.
Annex A: Overview of Simplified ERP Settlement Process
