Budget 2021: Petrol duty rates raised by up to 15 cents per litre

Budget 2021: Petrol duty rates raised by up to 15 cents per litre

Deputy Prime Minister Heng Swee Keat announced during Budget 2021 that petrol duty rates will be raised on Tuesday (Feb 16) and more road tax rebates will be introduced to ease the transition for drivers.

SINGAPORE: Petrol duty rates will be raised by 15 cents per litre for premium petrol from Tuesday (Feb 16), said Deputy Prime Minister Heng Swee Keat. 

The petrol duty rate for intermediate petrol will also be raised by 10 cents, he announced.

As it happened: DPM Heng Swee Keat's Budget 2021 speech

Petrol duty was last increased in 2015 when the rates for premium grade petrol and intermediate grade petrol were increased by S$0.20 and S$0.15 per litre, respectively.

“Usage based tax has helped shape consumer behaviour towards a more efficient use of fuel or environmentally friendly alternatives,” he said in his Budget speech. 

To ease the transition for Singaporeans, especially those who rely on their vehicles for their livelihood, Mr Heng also announced a slew of road tax rebates. 

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All motorcycles using petrol will receive a 60 per cent road tax rebate for one year, he said. Individual owners of smaller motorcycles of up to 400cc will receive either S$50 or S$80 in cash depending on engine capacity, he added. 

For active taxi and private hire car drivers using petrol and petrol hybrid vehicles, the budget provides petrol duty rebates of S$360 given out over four months, said Mr Heng. 

This is on top of a 15 per cent road tax rebate for one year for all taxis and private hire cars using petrol.

Budget 2021 petrol duties and road tax rebates
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Goods vehicles and buses using petrol will receive a 100 per cent one-year tax rebate, and cars using petrol will receive a one-year road tax rebate of 15 per cent, he added. 

All road tax rebates will take effect from August 1, 2021, and will be applicable for one-year until Jul 31, 2022. 

Road tax rebate LTA
(Table: LTA)

The additional petrol duty rebates for motorcycles, taxis and private hire cars will be introduced by the middle of 2021, with more details will be released by the Land Transport Authority (LTA) in April, Mr Heng said. 

The road tax rebates and the additional petrol duty rebates will be disbursed
automatically to those eligible, and there is no need to apply, said LTA in a separate press release on Tuesday. 

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Taken together, all the road tax measures will offset about one year of petrol duty increases for taxis and motorcycles, and about two-thirds for commercial vehicles and cars, he added. 

With the 15 per cent road tax rebate for cars, the minimum road tax payment for petrol and petrol-hybrid off-peak cars and revised off-peak cars will be reduced from S$50 to S$43 and from S$70 to S$60 respectively between Aug 1 and Jul 31, 2022, said LTA in the media release.

READ: Petrol duty rate hike - Tax rebates in Budget 2021 to ease transition to higher duties

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The road tax payable for petrol and petrol-hybrid Classic cars will be reduced from S$280 to S$238. With the 60 per cent road tax rebate for motorcycles, the road tax payable for petrol and petrol-hybrid classic motorcycles will be reduced from S$280 to S$112. 

Most of the expected revenue increase from the petrol duty changes in the coming year will be given out through the offsets, estimated to cost S$113 million, said Mr Heng.

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“Climate change is real and urgent. We must act now. Behavioural changes take time.” 

The COVID-19 pandemic has given Singapore an opportunity to change work and travel habits as remote working arrangements become more common, he added. 

“We must lock in these behavioural shifts. A car-lite society will continue to be our main goal. Public transport is, after all, the cleanest and most energy efficient mode of transport,” said Mr Heng.

The Government will be spending more than S$60 billion within this decade to expand and renew Singapore’s rail network, he added. 

“Overall, these measures will work towards reshaping our transport footprint, towards cleaner transport.”  

Source: CNA/hw

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