Singapore’s Budget 2025 marks an important moment for entrepreneurs and company owners. In a global market riddled with uncertainties, the Singapore government has introduced a strong package of support measures designed to ease costs and boost business growth. This post takes you through the new initiatives — from everyday expense relief and improved tax policies to targeted business support schemes — that will open up new opportunities for companies. For business leaders and entrepreneurs who want to stay competitive, Budget 2025 offers practical tools to reduce expenses, upgrade workforce skills, and drive innovation.

Decoding Budget 2025: A Comprehensive Overview

Announced by Prime Minister Lawrence Wong, Budget 2025 involves a record allocation of S$143.1 billion. This budget is not only about providing immediate relief but also about investing in long-term economic strength, with a keen focus on helping local businesses succeed. Key points of interest for entrepreneurs include:

Business Incentives: The budget introduces a 50% corporate income tax rebate, along with new tax deductions for shared innovation and cost-sharing agreements. These measures are meant to help lower operating costs and encourage investments in technology and research, helping companies stay ahead in a competitive market.
Investment in Workforce Skills: In recognition that a skilled workforce is essential for business success, the budget ramps up support for retraining and upskilling. Enhanced programs ensure that companies have access to capable and adaptable workers, ready to meet the challenges of a rapidly evolving economy.
Support for Households: While many measures—such as CDC vouchers, U-Save rebates, and LifeSG credits—are aimed at helping families manage rising living costs, these initiatives also contribute to a stronger consumer base. More financial stability at home means consumers can continue to spend, which in turn benefits local businesses.

Navigating Tax Reforms: What’s New?

Singapore’s Budget 2025 introduces a sweeping set of tax reforms aimed at maintaining the nation’s status as a premier investment hub while making compliance easier and encouraging innovation. Here are the key highlights:

1. Adapting to Global Standards with GloBE Pillar Two
Singapore has enacted the Multinational Enterprise (Minimum Tax) Act 2024 to align with the OECD’s Global Anti-Base Erosion Rules (GloBE), Pillar Two. Effective 1 January 2025, this new framework imposes a minimum effective tax rate of 15% on low-taxed entities within in-scope multinational groups through top-up taxes, such as the Domestic Top-up Tax (DTT) and Multinational Enterprise Top-up Tax (MTT). Companies will need to reassess their investment structures and compliance processes to meet these new requirements while continuing to benefit from Singapore’s supportive fiscal environment.

2. Enhanced Incentives for Capital Market Activities
To bolster Singapore’s capital market and promote local listings, the government has rolled out several targeted incentives:

Corporate Income Tax (CIT) Rebates: Tax resident companies and registered business trusts that pursue primary or secondary listings on the Singapore Exchange can access CIT rebates of up to 20% and 10% respectively. These rebates are contingent on fulfilling five-year listing requirements and making specified local investments.
Fund Manager Benefits: An enhanced 5% Concessionary Tax Rate (CTR) and corporate tax exemptions on qualifying income from funds investing in SGX-listed equities provide incentives for fund managers to expand their local operations.

3. Broadening Tax Exemptions and Deductions
Several key amendments have been introduced to provide greater tax certainty and flexibility:

Section 13W Enhancements: The scope of exemptions under Section 13W of the Income Tax Act has been expanded to include gains from the disposal of preference shares, with a new group-based assessment for the 20% shareholding threshold.
New Deductions for Innovation: A tax deduction for payments under approved cost-sharing agreements (CSAs) for collaborative innovation, along with deductions on payments made for issuing new shares under Employee Equity-Based Remuneration (EEBR) schemes, reinforces Singapore’s commitment to fostering technological innovation and talent development.

4. Additional Measures to Ease Tax Burdens
Other reforms aim to reduce overall tax pressures on businesses:

50% CIT Rebate: Companies that are active and employ at least one local person in CY2024 will benefit from a 50% CIT rebate. This measure is designed to ease cash flow constraints amid rising operating costs.
Land Intensification Allowance (LIA) Adjustments: Lowering the shareholding requirement from 75% to more than 50% under the LIA scheme encourages efficient land use and makes the incentive accessible to a broader range of companies.
New CTR Tier: The introduction of an additional 15% Concessionary Tax Rate tier under various schemes further assists businesses in managing tax liabilities, especially in the context of global minimum tax obligations.

Empowering Citizens: New Support Measures for Individuals

Singapore’s Budget 2025 is all about strengthening the social safety net, ensuring every citizen feels supported amidst rising living costs and a rapidly changing economy. Prime Minister Lawrence Wong emphasized that this Budget is “for all Singaporeans,” saying it offers a wide-ranging suite of initiatives that will give individuals and families the power to better manage their own financial well-being.

Alleviating Cost-of-Living Pressures
The government is rolling out several measures to ease everyday expenses:

CDC Vouchers: Every household will receive S$800 in CDC vouchers—S$500 disbursed in May 2025 and the remaining S$300 in January 2026—usable at heartland merchants, hawker stalls, and supermarkets.
U-Save Rebates: Eligible HDB households can benefit from U-Save rebates between S$440 and S$760, covering around three months’ worth of utilities expenses, with disbursements scheduled for April and October.
LifeSG Credits: Families will receive S$500 in LifeSG credits for each Singaporean child aged 12 and below, while youths aged 13 to 16 enjoy a S$500 top-up to their Edusave accounts and those aged 17 to 20 see similar benefits in their Post-Secondary Education Accounts.

Celebrating SG60 and Financial Incentives
In a festive nod to Singapore’s 60th birthday, the Budget introduces special incentives:

SG60 Vouchers: All Singaporeans aged 21 and above will receive SG60 vouchers—S$600 for those aged 21 to 59 and S$800 for individuals 60 and above, valid until December 31, 2026.
Income Tax Rebate & ActiveSG Credits: A 60% personal income tax rebate (capped at S$200) complements these vouchers, along with S$100 in ActiveSG credits for sports and recreational activities, encouraging a healthier, more active lifestyle.

Strengthening Family Support
Families are at the heart of these initiatives:

Large Families Scheme: Designed for households with three or more children, this scheme offers up to an additional S$16,000 in support, including a S$5,000 top-up for the Child Development Account (CDA) and a one-time S$5,000 Medisave Grant for pregnancy and delivery costs.
Annual LifeSG Credits: Beyond the initial support, families will receive S$1,000 in annual LifeSG credits per child until the child turns six, helping to ease everyday expenses.

Enhanced Support for Seniors
To secure a dignified retirement and better healthcare:

New Matched MediSave Scheme (MMSS): Launching in 2026, eligible seniors aged 55 to 70 with lower CPF balances will benefit from a dollar-for-dollar match on voluntary top-ups, up to S$1,000 per year.
Improved Long-Term Care Subsidies: Increases of up to 15% in subsidies for residential, home, and community care, along with a boosted Home Caregiving Grant (up to S$600 per month), ensure that seniors receive more comprehensive support.
Expanded EASE Programme: The EASE initiative, which provides subsidized home modifications for senior-friendly living, will be extended to include private property households for an additional three years.

Boosting Skills and Employment Opportunities
To help individuals remain competitive in the job market:

Extended SkillsFuture Level-Up Programme: Mid-career workers, particularly those aged 40 and above, can now enroll in part-time courses with a fixed monthly allowance of S$300 (effective early 2026) to offset training costs.
Enhanced Workfare Skills Support (WSS): Lower-wage workers aged 30 and above will receive improved training allowances, reinforcing Singapore’s commitment to lifelong learning and workforce resilience.

Inclusive Measures for Underserved Groups
The Budget also takes a progressive step towards social inclusion:

Extended Uplifting Employment Credit (UEC): The credit, which helps employers with wage offsets in return for hiring local ex-offenders, is extended until the end of 2028 to support the smoother reintegration of such individuals into the workforce.
Expanded Matched Retirement Savings Scheme (MRSS): This scheme, which now applies to eligible persons of all ages who have disabilities, offers a matching grant on CPF top-ups, broadening the social safety net for vulnerable groups.

Promoting Sustainable Living
Supporting eco-friendly choices is another pillar of the Budget:

Climate Vouchers: All HDB households will receive an extra S$100, while citizens who own private properties will be given S$400 in Climate Vouchers, meant to encourage investment in energy- and water-efficient products.

Fueling Business Growth: Fresh Incentives for Singapore Companies

Singapore is intensifying its support for companies aiming to broaden their global reach. A series of extended and enhanced incentives help local businesses navigate the challenges of international expansion and mergers and acquisitions (M&A) with greater confidence and financial backing.

Extended Market Readiness Assistance (MRA) Grant

The government has extended the MRA grant to help companies offset the costs of setting up operations abroad, market promotion, and business development. Now available until 31 March 2026—up from the original end date of 31 March 2025—this initiative offers up to SG$100,000 per new market. This extension ensures that SMEs have sufficient support to explore international opportunities and solidify their presence overseas.

Prolonged Double Tax Deduction for Internationalisation (DTDi) Scheme

Under the DTDi scheme, businesses can claim a 200% tax deduction on eligible expenses related to market expansion and investment development. Initially scheduled to conclude at the end of 2025, the scheme has now been extended until 31 December 2030. This prolonged support is a reflection of Singapore’s commitment to empowering companies as they venture into new international markets.

Enhanced Enterprise Financing Scheme (EFS)

The Enterprise Financing Scheme has been significantly enhanced in recognition that companies need to be able to access financing throughout their years of growth. A permanent increase in the EFS–Trade Loan cap—from SG$5 million to SG$10 million—gives companies more liquidity to support their expansion efforts. In addition, the scope of the EFS–Mergers and Acquisitions Loan has been broadened to include targeted asset acquisitions, effective from 1 April 2025 to 31 March 2030, thereby facilitating strategic investments and business consolidations.

Extended Support for Internationalization and M&A

Bolstering its commitment to global business expansion, the government has also extended the M&A scheme until 31 December 2030. This initiative provides an M&A allowance, written down over five years, amounting to 25% of qualifying acquisitions up to SG$40 million per year. Companies can also benefit from a 200% tax deduction on transaction costs, capped at SG$100,000 per year, easing the financial burden associated with these significant strategic moves.

Partnering for Success: How We Can Help

Thanks to the attractive opportunities presented by Budget 2025, launching your business in Singapore has never been easier. At CorporateServices.com, we’re your go-to partner for setting up your company, handling compliance, and managing work visas so you can focus on growing your business. Ready to get started? Contact us today.

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Headquartered in Singapore, CorporateServices.com, empowers global entrepreneurs with information and tools necessary to discover Singapore as a destination for launching or relocating their startup venture and offers a complete range of company incorporation, immigration, accounting, tax filing, and compliance services in Singapore. The company combines a cutting-edge online platform with an experienced team of industry veterans to offer high-quality and affordable services to its customers. Contact Us if you need assistance with setting up a new Singapore company or if you would like to transfer the administration of your existing company to us.

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