Increasing Car Taxes Can Reduce Road Congestion

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There are compelling arguments to suggest that increasing car taxes can address congestion problems in Malaysia, a move that aligns with international urban planning practices.
In the first of a two-part series, I would like to draw readers’ attention to this issue and rationalise the contradictions.
Rationale for tax hike
It has been said that excessive car ownership and usage is the cause of congestion on Malaysian roads, not just in the Klang Valley but practically throughout the country, including in Sabah and Sarawak.
Malaysia’s growing middle-class families don’t just own one car. In many households, multiple vehicles of different brands and types can be seen in their driveways.
Cheap prices, with no car use restrictions in place, and affordable financing options, have all led to very high car ownership and growth rates, although cars themselves are depreciating assets.
The Klang Valley, Penang and Johor are examples of places overwhelmed by vehicles, resulting in frequent gridlocks.
We now know that building more roads or highways to accommodate more cars is wasteful and ineffective in alleviating congestion.
Studies from urbanised countries, including the US and Japan, show that expanding road infrastructure leads to “induced demand”, where more roads encourage more people to buy more cars and drive, exacerbating congestion rather than solving it.
Taxation as a proven deterrent
The high car taxes imposed by our neighbour down south has been a success story.
Singapore is acknowledged as a good example worldwide. It imposes high registration fees for cars and a high road tax. The difficulty in getting a certificate of entitlement to own cars is also an effective measure in controlling the number of cars on its roads.
This policy has significantly reduced road congestion and improved public transport usage.
These days, Singaporeans are not considered poor just because they do not own a car. It proves that financial measures can bring about behavioural change.
Increasing car taxes as well as implementing congestion charges in cities can discourage unnecessary private vehicle use.
The city of New York is the latest example of how a congestion fee has managed to reduce city centre traffic by almost 20% daily.
The levy of a US$9 fee for cars entering the city limits has incentivised people to shift to alternative modes of transport, such as buses, trains, demand responsive transport and motorcycles.
Congestion is costly
Congestion is the main cause of the loss of productivity, and the unnecessary waste of time and energy. It also causes too much stress to car users.
A city choked with traffic is unattractive, unfriendly and won’t draw many tourists either.
Factors such as lower vehicular emissions can lead to better air quality, reducing respiratory issues and other health problems associated with congestion and pollution, directly improving public health.
In the case of Malaysia, the additional revenue generated from increased car taxes can be channelled to expanding rail networks like the MRT, LRT and KTM services.
Additional tax revenue can also be reinvested into building more facilities and subsidies for public transport systems and services across the country.
To encourage users to move away from cars the government must improve bus networks so that they connect underserved areas, create responsive demand transport options and redesign urban landscapes to accommodate e-vehicles and e-scooters
Switch to public transport
No doubt ensuring public transport is affordable, reliable and safe requires much expenditure from the government but it can be successful, as shown in Japan, South Korea and Singapore, Asia’s three high income countries.
They have demonstrated that robust public transport systems can reduce car dependency, alleviate road congestion, and make cities more liveable.
Japan and South Korea are notable examples, as they themselves are big producers of motor vehicles and yet aggressively control their own domestic car usage.
Is this not what our country should be aiming for? - FMT
The author can be reached at: [email protected]
The views expressed are those of the writer and do not necessarily reflect those of MMKtT.

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