MOS Josephine Teo: No special COE category for first time buyers

A traffic jam in Singapore

A Certificate of Entitlement (COE) category favouring first time buyers ‘would not be fair’ said Minister of State for Transport Josephine Teo in Parliament on Tuesday.

Teo was responding to a suggestion from MP Intan Azura Mokhtar that first time buyers be classified under a different category where they can enjoy substantially lower COE prices. She also suggested that this scheme extend to the first vehicle purchased by each registered business.

This would ideally give households with young children and entrepreneurs a leg up when they might otherwise be priced out by skyrocketing COE prices in recent months.

In January this year, COE prices in the open category nearly breached the $100,000 mark.

However, MOS Teo responded that a special category for this group of people would create the problem of deciding whether a second-time buyer was necessarily less deserving of a cheaper COE than a first time buyer.

“Consider the perspective of a growing household where the grandparents have moved in to stay, or the family has had more children, and are planning to buy a bigger or second car. To this family, a COE system which favours first-time buyers would not be fair,” said Teo.

“They would argue that their needs are greater than first-time buyers who are singles, or have no elderly members in the household.”

MOS Teo also said that almost 1 in 2 households in Singapore already own a car.

“In land-scarce Singapore, we do not have the luxury of letting everyone own a car. We also cannot put car ownership in the same category as housing, health or education which are basic necessities. Our current VQS is not a perfect system but still the most appropriate way to allocate a limited and non-basic resource.”

Reported with Jeanette Tan at Parliament

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