Singapore Budget 2025 - Tax Changes Overview & Key Highlights

A Strategic Blueprint for Economic Growth and Social Progress

The Singapore Budget 2025 was unveiled with the theme "Onward Together for a Better Tomorrow." This year's budget builds upon past efforts to address economic and social challenges while positioning Singapore for sustained long-term growth. Below is a summary of the key highlights and their implications for businesses and individuals, particularly from the lens of Apexia Corporate Advisory.

1. Managing Cost Pressures Amidst Global Uncertainties

The Singapore government acknowledges that cost pressures, particularly inflation and rising business expenses, remain key concerns. To mitigate these challenges, the Budget introduced several measures:

• Corporate Income Tax Rebate: A 50% rebate, capped at $40,000, for companies in the Year of Assessment 2025.
• Minimum Tax Relief for SMEs: Companies employing at least one local worker will receive a minimum benefit of $2,000.
• Continued Support for Lower-Income Workers: Enhancements to the Progressive Wage Credit Scheme, increasing government co-funding for wage increases.
• Utility Cost Assistance: Households will receive up to $760 in U-Save rebates to offset utilities.

These measures will help businesses manage rising costs while ensuring wage sustainability and worker retention.

2. Advancing Singapore's Growth Frontier: Innovation and Enterprise

Singapore remains committed to maintaining its competitive edge as a global innovation hub. Several initiatives were announced to strengthen the country's enterprise ecosystem:

• $3 Billion Top-up to the National Productivity Fund to support technological advancements and industry transformation.
• New R&D Facilities: Investments in semiconductor R&D fabrication and biotech research infrastructure in one-north.
• Enterprise Compute Initiative: A $150 million scheme to support AI adoption and integration for businesses.
• Private Credit Growth Fund: A new $1 billion initiative to provide alternative financing solutions to high-growth companies.
• Enhancements to SME Digitalisation Grants: The Productivity Solutions Grant and SMEs Go Digital initiatives will be expanded.

These policies will support companies looking to leverage digitalisation, artificial intelligence, and deep-tech capabilities to drive growth.

3. Workforce Development and Lifelong Learning

With rapid technological disruptions, continuous workforce upskilling remains a key focus:

• SkillsFuture Level-Up Programme: Mid-career Singaporeans (aged 40 and above) will receive $4,000 in SkillsFuture Credit.
• New Workforce Development Grant: A consolidation of existing WSG and SkillsFuture grants with higher support of up to 70% for job redesign initiatives.
• Expanded Career Support for Seniors: Senior Employment Credit extended till 2026, alongside a CPF contribution increase for older workers.

By facilitating upskilling and career transitions, these initiatives ensure that Singaporeans remain competitive in a changing job market.

4. Sustainable Infrastructure and Clean Energy Investments

Singapore is ramping up efforts to secure a climate-resilient and sustainable future.

• $5 Billion Top-up to the Future Energy Fund to accelerate clean energy transitions, including hydrogen and nuclear feasibility studies.
• Heavy Vehicle Zero Emissions Scheme to incentivize the adoption of electric heavy vehicles.
• New Coastal and Flood Protection Fund: An additional $5 billion investment to safeguard Singapore against rising sea levels.
• Expansion of Public Transport Infrastructure: Over $60 billion in investments in new MRT lines and bus services.

These investments position Singapore as a leader in sustainable urban planning and energy resilience.

5. Supporting Families and Social Inclusion

Apexia Corporate Advisory recognizes the importance of social cohesion and inclusivity in fostering a stable business environment. The Budget introduced several measures to enhance social support:

• SG60 Package: All Singaporeans aged 21 and above will receive $600 in SG60 Vouchers.
• New Large Families Scheme: Additional benefits for families with three or more children, including a $5,000 Medisave Grant and $1,000 annual LifeSG credits.
• Enhanced Support for Seniors: The Home Caregiving Grant will increase to $600 per month, benefiting more than 80,000 seniors.
• Disability Inclusion Initiatives: The Enabling Employment Credit will be extended till 2028 to encourage companies to hire persons with disabilities.

These social measures provide greater financial security for families while ensuring that businesses operate within a socially inclusive framework.

6. Fiscal Prudence and Long-Term Sustainability

Despite significant spending, Singapore remains committed to fiscal discipline:

• The Personal Income Tax Rebate for Year of Assessment 2025 will provide a 60% rebate, capped at $200.
• Continued investments in public housing, healthcare, and retirement adequacy without excessive debt accumulation.
• Medium-Term Fiscal Outlook: Plans for a fair and resilient tax system to support Singapore's long-term financial stability.

Conclusion: What This Means for Businesses and Individuals

The Singapore Budget 2025 outlines a clear roadmap for sustaining economic growth while reinforcing social resilience. Businesses should capitalize on innovation grants, workforce transformation schemes, and corporate tax reliefs to remain competitive. Meanwhile, individuals can benefit from enhanced job security, upskilling programs, and family support measures.

At Apexia Corporate Advisory, we are committed to helping businesses navigate these changes. Our team is ready to assist companies in leveraging available incentives, digital transformation opportunities, and workforce development programs. Contact us today to ensure that your business is well-positioned for the opportunities presented in Budget 2025.