Although the Land Transport Authority changed the Quota Counting Method, which resulted in some cooling off prices, most COE Prices will continue upwards into 2023. Read on to find out why.
Since 2002, COE Quota for Cat C this year is at the lowest, but premiums remain at $65,991. Only a slight dip of $1,010 from the previous bid. If you are still sitting on the fence regarding buying NEW or USED, do the sums
Regardless if you buy NEW or USED next year, GST will increase from 7% to 8% with effect from 1st Jan 2021. Many people are not aware, but GST is chargeable for:
FOR NEW VEHICLES
The selling price of the vehicle, less Additional Registration Fee (ARF), Certificate of Entitlement (COE), Registration Fee (RF) and Road tax
There are 2 common methods to charge GST.
- Gross Margin Scheme
- Discounted Sale Price Scheme
Without going into the technicals & calculations, you WILL pay MORE GST next year on your purchase, regardless if New or Pre-Own.
Let’s assume you think the 1% GST increase is marginal, and not significant.
The decreased COE Quota means the price for Cat C, along with all other categories will climb.
Last COE bidding saw the COE Cat B drop by $12,195 to hit below $100,000 mark. Its anyone guesses how the next bidding will fare, we do know with a COE Quota (Cat C) of only 84, but 148 bids received, demand exceeds supply. Those that are not able to secure a COE from the last round, will try harder, and bid higher. Hence, a natural curve for premiums to climb.
Don’t want to try your luck bidding?
Well, the current Prevailing Quota Price (PQP) for Cat C (Oct) is $59,344. You could renew your existing vehicle COE for some savings, or buy a pre-own commercial vehicle with COE.
You get a relatively good-condition vehicle, that comes pre-fixed with accessories, and pay less cash upfront compared to a new one when you take a loan.