Singapore Raises Vehicle Entry Permit; Malaysia Reacts

Malaysians and Singaporeans are like siblings – one moment we’re the best of buddies, the next we’re at each other’s neck. At this moment, we’re not exactly on the best of terms. Early this month, the little island across from the tip of the Malaysian Peninsular announced a whopping 75% increase on the Vehicle Entry Permit (VEP) fee, from SG$20 to SG$35 per day for foreign-registered cars and a quadrupling of fee for goods vehicles, from SG$10 to SG$40, with effect from 1 August 2014. Buses, taxi’s and motorcycles are unaffected.

Naturally, the move was met with agitation and concern by Malaysians. According to Bernama, about 13,000 foreign-registered vehicles traverse the causeway into Singapore daily. Another report stated that 15,000 children, mostly from Johor, commute to Singapore to attend school daily (the numbers do not tally, we realised, but perhaps most of the children take the bus). Many Malaysians, and some Singaporeans even, opt to live in Johor where real estate is much cheaper, and homes are sprawling compared to the pigeonhole HDB flats in Singapore; these cost-conscious residents commute to and from Singapore daily for work. While they now pay SG$400 a month for the VEP, they would have to fork out SG$700 per month after the fee hike takes effect. The business community has also expressed their concerns, as the additional fees on goods vehicles would severely impact logistics and supply chain costs.

The Land Transport Authority of Singapore stated that the fee hike is due to the “widening cost difference in recent years.” We take that to mean ‘hey, we could make more money here; why didn’t we do it earlier?’

What was Malaysia’s response? Well, when your brother hits you, you hit him back. The state of Johor, which is where the exit points from Malaysia to enter Singapore are located, submitted a proposal to the Ministry of Transportation to start imposing a charge for entry into the Malaysian border, and according to Bernama, it has been approved by the federal government.

Some regular commuters has considered purchasing a Singapore-registered car to counter the increased VEP, but they now lament that this would mean they would have to pay the entry fee when returning home. Either way is a lose-lose situation.

A spokesperson from the Singapore Transport Ministry said that the ministry has contacted its Malaysian counterpart to seek further details, as the Malaysian entry fee is deemed discriminatory towards Singaporean vehicles; based on reports thus far, the entry fee into Malaysia will only be imposed at the border with Singapore, but not at the northern border shared with Thailand. We would think that the answer is obvious, considering that vehicle entry fees into Malaysia was never really discussed until the VEP hike, and very quickly escalated into becoming reality (that is if Malaysia’s government doesn’t changes its mind…it has happened before, so we wouldn’t be surprised.)

2018 cannot come soon enough, we think. It is the target date of completion for the proposed Johor Bahru-Singapore MRT link. If these two countries take pity on the poor, hardworking folks who are trying to make a living transborder, they might wait until the MRT is completed to have this childish ‘you beat me, I beat you, why did you beat me back?’ sort of conflict. 

image: motortrader.com.my