He was planning to replace his current five-year-old Ducati 848 with a new Ducati Panigale this year, but Mr Kevin Liew now has to consider cheaper options instead.
The change of plans came after Finance Minister Heng Swee Keat announced a new tiered tax system for motorcycles while delivering the Budget on Monday (Feb 20) in Parliament.
Under the new system, the 15-per-cent Additional Registration Fee (ARF) will stay for motorcycles with an open market value (OMV) of up to S$5,000. The subsequent S$5,000 of its OMV will incur an ARF of 50 per cent, and the remaining OMV above S$10,000 will come with an ARF of 100 per cent.
The Ducati Panigale that Mr Liew was eyeing was estimated to cost around S$40,000, but with the changes, it would cost “around S$50,000 or S$60,000”, the 27-year-old marketing manager said.
“Bikes are already overpriced in Singapore compared to other countries because of the COE (Certificate of Entitlement),” Mr Liew added. “With this new scheme, they are only going to get even more expensive.”
Mr Heng said that a small but rising number of buyers are getting expensive motorcycles, with OMVs similar to those of small cars. To address this, the tiered ARF would be introduced for motorcycles registered with COEs obtained from the second February bidding exercise onwards.
He added that, going by current registration trends, more than half of new motorcycle buyers would not have to pay more.
Although the new tax scheme is meant to target luxury-bike owners, some owners of “working class” motorcycles said that they would be affected as well. And the bikers community is upset over the move, lamenting that it would cause a spike in motorcycle prices.
Mr Justin Khaw, 25, who rides a Honda Trial Bike and was planning to switch to a Honda Africa Twin, said: “Nowadays, most bikes in the open class 2A category cost close to S$10,000 and above.”
With the new ARF, instead of paying S$32,000 for the Honda Africa Twin, Mr Khaw, an undergraduate, will have to fork out around S$36,000 to S$40,000. He has since decided to look for something cheaper.
Mr Khaw remarked that the move would do little to reduce vehicular traffic. “If Singapore’s goal is to curb congestion on the roads, then perhaps alternative transport such as motorcycles should be considered. So why are the taxes for motorcycles increasing? Shouldn’t it be decreasing instead?”
Given that cars and motorcycles do not contribute to congestion equally, he said, he wondered why bikers are “taxed and subjected to the same vehicle control policies as cars”.