Vehicles ordered to adopt ERP 2.0 by Jan 2027 as LTA tightens penalties

Authorities pursue remaining vehicles as over 93% adopt ERP 2.0.

All Singapore-registered vehicles must be equipped with the new satellite-based Electronic Road Pricing (ERP 2.0) system by 1 January 2027, according to a press release. Vehicles without an OBU will be barred from using public roads from 2027.

The mandate, part of the Land Transport and Related Matters Bill moved by Acting Minister for Transport Jeffrey Siow, marks the final phase of the nationwide transition.

Whilst more than 93% of the vehicle population, or around 930,000 vehicles, has already installed the new On-Board Units (OBUs), authorities are now targeting the remaining vehicles through a combination of incentives and stricter penalties.

Beginning 15 February 2026, the Land Transport Authority (LTA) will issue final reminders to vehicle owners who have yet to switch systems. They are given a three-month window from the date of the reminder to install the OBU free of charge.

After the grace period, motorists will have to pay for installation, $35 for motorcycles and $70 for other vehicles. 

From 1 January 2027, the LTA will decriminalise missed ERP payments. Currently, failure to pay a toll constitutes a traffic offence that may lead to court prosecution.

Under the new framework, responsibility for missed charges will shift from the driver to the vehicle owner, who will receive an SMS notification and have five days to make payment.

If payment remains outstanding after five days, the LTA will impose a $10 administrative fee, and the owner will be blocked from essential LTA services, including road tax renewal, vehicle ownership transfers, and the encashment of COE or PARF rebates.

To safeguard the integrity of the satellite-based system, the government will impose harsher penalties for tampering with OBUs or providing unauthorised installation services.

Serious cases of non-compliance may result in fines of up to $20,000 or imprisonment of up to 12 months, the press release said.

Fines for workshops carrying out illegal modifications will double, reaching $40,000 for first-time corporate offenders and $80,000 for repeat offenders.

Individuals using unregistered or deregistered vehicles may face up to two years’ imprisonment and fines of up to $20,000.

Siow noted that whilst satellite technology enables distance-based charging, where motorists are charged per kilometre travelled, the government does not intend to implement this in the near term.

Instead, the immediate benefits of ERP 2.0 include the removal of physical gantries and the ability to spread charges more evenly across persistent congestion hotspots.

The OBUs will also eventually support contactless payments for land checkpoint tolls and electronic parking. Enhanced penalties for safety-related offences and illegal modifications will take effect on 27 February 2026.