EV Tax Credit: Rules for New and Used Electric Vehicles

Thinking of going electric in 2025? Good news—buying an electric vehicle (EV) in Singapore could save you up to S$40,000, thanks to a mix of government rebates and tax perks.

While we don’t have a “tax credit” like the U.S., schemes like the EV Early Adoption Incentive (EEAI), Vehicular Emissions Scheme (VES), and ARF rebates offer serious savings that work in a similar way.

Whether you’re eyeing a new BYD or a secondhand Tesla, understanding how these incentives work can help you cut costs and make a smart, future-ready purchase.

↓ Jump to: Cars that qualify for the 2025 credit

Let’s get one thing clear first—unlike countries like the U.S., Singapore doesn’t offer an income-based electric car tax credit. We do have tax reliefs, but none that are EV-related.

Instead, what we get are upfront rebates that directly reduce the cost of your car before you even drive it off the lot. Think of it as a discount built into the price tag, not something you claim during tax season.

The first incentive is the EEAI. The EEAI is a limited-time scheme (until Dec 2025) that gives you up to S$15,000 off the Additional Registration Fee (ARF) when you buy a new fully electric car. It’s automatically applied when you register your vehicle, so there’s no need to fill out extra forms or jump through hoops.

Next is the VES. The VES rewards you for driving a cleaner car. If your EV falls under Band A1 or A2 (the cleanest categories), you can get up to S$25,000 in additional rebates, also applied directly to reduce your ARF.

Normally, ARF is a hefty fee based on your car’s Open Market Value (OMV), and it can add tens of thousands to the cost. But with EEAI and VES, those rebates go straight toward reducing the ARF, making your car much more affordable upfront.

These incentives aren’t just to help you save though, they’re part of the Singapore Green Plan 2030, which aims to make EVs the norm and cut transport emissions. So when you switch to an EV, you’re not just saving money; you’re also helping Singapore go greener.

For VES, the amount you’ll get depends on how environmentally friendly your car is. The good news is, most fully electric cars fall into the A1 band, which qualifies you for a $25,000 rebate. So as long as you’re purchasing a full electric EV car, you’re likely going to get the full rebate. Just make sure to check with your dealer to confirm.

Hybrid cars that meet the criteria for Band A2 are eligible for a $2,500 rebate. In rare cases, if they have exceptionally low emissions, they may even qualify for Band A1.

For EEAI, you’re only eligible for it up till 31 December 2025, as that’s when the scheme expires.

These are just a few popular brands and models. Again, most fully electric EVs will likely qualify for the full VES rebate, and as long as you’re purchasing by 31 December 2025, you’ll be eligible for EEAI too.

In rare cases, a fully electric EV may not be environmentally friendly enough to qualify for Band A1 for VES, so to be safe, always check with your dealer.

Ready to Make the Switch to Electric?

Explore our comprehensive guides to navigate your EV journey:

• Electric car buying guide

• The real cost of electric cars

• Cheapest electric cars in Singapore 2025

» Learn how to calculate an auto loan in Singapore.

If you registered an electric vehicle (EV) in Singapore in 2024, you still benefited from two key financial incentives designed to make EV ownership more affordable.

The EEAI scheme was still active, and the maximum cap remained at $15,000 in 2024, but was actually $20,000 in 2023, so there was a $5,000 decrease from 2023 to 2024.

Similarly, the Band A1 VES rebates remained the same as 2025 in 2024. However, if your EV fell into Band A2, you would have been eligible for a higher Band A2 rebate of up to $5,000.

As such, you would have earned the same rebates in 2024 as 2025 unless your EV car fell into Band A2.

While the government offers attractive rebates to make your transition to an EV car smoother and more affordable, to fully tap into these savings, you need to ensure your vehicle is a fully electric model—not a hybrid—and register it before December 31, 2025, to qualify for EEAI.

Additionally, aim for an EV that falls into VES Band A1 or A2 to maximize your rebates. Aim for Band A1 for the most savings, which most fully electric vehicles will fall into.

Vehicle price cap

While there's no direct cap on rebates tied to the vehicle's price, the ARF operates on a tiered system:

• First S$20,000 of OMV: Taxed at 100%

• Next S$20,000 (S$20,001 to S$40,000): Taxed at 140%​

• Next S$20,000 (S$40,001 to S$60,000): Taxed at 190%

• Next S$20,000 (S$60,001 to S$80,000): Taxed at 250%

• Above S$80,000: Taxed at 320%

This means that as the OMV increases, the ARF payable rises significantly. For example, a vehicle with an OMV of S$30,000 would incur an ARF of S$24,000:​

• First S$20,000 at 100%: S$20,000

• Next S$10,000 at 140%: S$4,000

Note that regardless of rebates like EEAI and VES, a minimum ARF of S$5,000 is payable for cars that are not fully electric.

In addition to the ARF, securing a Certificate of Entitlement (COE) is mandatory for vehicle ownership in Singapore.

EV tax credit income limits

​In Singapore, electric vehicle (EV) rebates are straightforward and apply uniformly to all qualifying EV purchases, regardless of the buyer's income. This differs from countries like the United States, where EV tax credits are subject to income limits.

New EVs

• EEAI

• VES

Used EVs

Currently, Singapore does not extend these specific incentives to used EVs. The EEAI and VES rebates are designed to encourage the adoption of new electric vehicles and do not apply to pre-owned EV purchases.

Final assembly requirements

​In Singapore, purchasing an electric vehicle (EV) is straightforward, as there are no requirements regarding where the vehicle is assembled. This means all qualifying EVs, regardless of their manufacturing origin, are eligible for government incentives like the Electric Vehicle Early Adoption Incentive (EEAI) and the Vehicular Emissions Scheme (VES).

This approach simplifies the buying process, allowing you to focus on choosing the EV that best fits your needs without worrying about assembly locations.

By now, you should have a good idea of how to calculate EEAI and VES, but just to recap:

• EEAI: An electric car rebate offering 45% off the Additional Registration Fee (ARF), capped at S$15,000, for newly registered fully electric cars and taxis.​ Effective until December 31, 2025.

• VES: A policy designed to encourage the purchase of cleaner cars with lower emissions, offering a rebate of $25,000 for cars in Band A1 and $2,500 for cars in Band A2.

These rebates can be stacked, offering combined savings of up to S$40,000 on the ARF for eligible EVs.

Note that if your car isn’t fully electric, the ARF Floor Rule dictates that the minimum ARF payable is $5,000, even if your rebates would have enabled you to pay less. However, for fully electric cars and taxis, there is no minimum payable amount, so if the rebates bring your ARF down to zero, you would not have to pay any ARF.

In addition, unlike some countries, Singapore's EV government rebates are not contingent on the origin or composition of the vehicle's battery or critical minerals. This means all qualifying EVs, regardless of their manufacturing specifics, are eligible for these incentives.​

Thinking about purchasing a used EV in Singapore? While the government offers attractive rebates for new EVs, these incentives do not extend to pre-owned EVs. This means that when buying a used EV, you'll need to consider the full cost without expecting these government subsidies.​

However, opting for a used EV can still be financially savvy. Pre-owned vehicles typically come with a lower upfront price tag, making them more accessible for budget-conscious buyers.

It's also important to note that the Certificate of Entitlement (COE) is a significant component of car ownership in Singapore. When purchasing a used EV, the remaining duration of its COE will affect its overall value and the period you can use the vehicle before needing to renew the COE. ​

» Curious about other tax incentives for going green? How the green renovation loan works

Purchasing an EV in Singapore is made more affordable through government incentives. The good news is that these rebates are automatically applied during the vehicle registration process, requiring no additional effort from you.

Will the dealer handle my EV rebates?

Typically, car dealers handle the application of these rebates during the vehicle registration process, ensuring that the discounts are factored into the final price you pay.

When you decide on an EV, the dealer usually manages the paperwork related to EEAI and VES rebates. They submit the necessary documents to the Land Transport Authority (LTA) on your behalf, streamlining the process and saving you the hassle of dealing with administrative procedures.

Nonetheless, for your own sake, it’s still important to carefully review the price breakdown provided by the dealer and ensure that both EEAI and VES rebates are clearly listed and accurately applied before finalizing the purchase.

You should also discuss with the dealer beforehand to confirm that the EV model you're purchasing qualifies for these rebates, as eligibility can vary based on the vehicle's specifications and emission standards.

When purchasing an electric vehicle (EV) in Singapore, dealers will usually manage the application of government rebates such as the Electric Vehicle Early Adoption Incentive (EEAI) and the Vehicular Emissions Scheme (VES). While the dealer handles most of the paperwork, as a buyer, it's essential to ensure the following:

Besides the EEAI and VES, there aren’t any more EV rebates and incentives currently.

The current incentives are also set to expire at the end of 2025, although the government is expected to review and possibly adjust these schemes based on the EV adoption rate and other environmental goals. Staying informed about these changes will help you plan your EV purchase effectively.​

Discussions are also underway regarding the implementation of a road usage-based tax for EVs. This would mean charges based on the distance driven, aiming to ensure fair contribution to road maintenance. Although no official policy has been enacted yet, it's worth keeping this in mind for future budgeting.​

Transitioning to an electric vehicle (EV) in Singapore in 2025 will allow you to capitalize on substantial government incentives. Through the EEAI and the VES, you can enjoy combined rebates of up to S$40,000, significantly reducing your vehicle's upfront costs.

To ensure you get these benefits, always choose reputable dealerships and consult with them to make sure your chosen EV qualifies for these incentives and that they're accurately reflected in the pricing.​

It’s also worth checking with official sources to verify your vehicle's emission band and corresponding rebates.

To stay informed and in the loop, you can also check out our EV buying guide, our list of the cheapest electric cars, and the best insurance policies for electric cars.

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