Singapore Budget 2025 introduces several key measures that will affect both employees and businesses. These initiatives aim to reduce business costs, enhance workforce skills, and foster economic growth.
1. 50% Corporate Tax Rebate to Alleviate Business Costs
The Singapore government will continue to offer a 50% corporate tax rebate in 2025, capped at S$40,000 per company. This ongoing initiative helps businesses reduce operational costs and provides financial relief in the post-pandemic economy.
Additionally, businesses that hire at least one local employee in 2024 will receive a minimum rebate of S$2,000.
2. Workforce Enhancement & Wage Support
Several measures are being introduced to strengthen the workforce and support wage growth.
Progressive Wage Credit Scheme (PWCS)
In 2025, the government will increase its subsidy for wage increases to 40% (up from 30% in previous years). This subsidy will gradually decrease in 2026 to 20% (down from 15%).
SkillsFuture Training Initiatives
To encourage lifelong learning, the government will offer various training allowances:
- Full-time Training Allowance: Up to S$3,000 per month for a maximum of 24 months.
- Part-time Training Allowance: S$300 per month (to be implemented in 2026).
Moreover, businesses will receive a 70% subsidy for training employees, digital transformation, and job redesign.
CPF Adjustments for Older Employees
The government will also increase Central Provident Fund (CPF) contribution rates for older employees as part of its efforts to support senior workers.
- For Employees:
- Low-income workers will benefit from higher earnings, while mid-career professionals will receive enhanced support for skills upgrading and career transitions.
- For Businesses:
- Employers will face reduced costs for training and wages, with the government sharing the financial burden. This will enable businesses to invest more in employee development and improve the return on investment in their workforce.
3. Fostering Economic Growth & Business Support
The government is committed to stimulating economic growth through increased support for businesses and innovation.
Business Financing & Innovation Support
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The National Productivity Fund (NPF) will receive an additional S$3 billion to support innovation, technology adoption, and productivity improvements within businesses.
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The Private Credit Growth Fund will receive an additional S$1 billion to support the financing needs of high-growth local companies.
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The government will also introduce tax incentives to encourage local enterprises and fund management companies to list on Singapore’s stock exchange.
- For Businesses:
- Companies will have easier access to financing, enabling them to scale up operations, innovate, or pursue public listing.
- For Job Seekers:
- As businesses expand, there will be increased demand for talent in areas such as research and development, project management, digital strategies, and international business development.
The Singapore Budget 2025 marks a significant step toward a more competitive and sustainable economy in Singapore. With continued financial relief for businesses, enhanced wage support for employees, and a focus on skills development and economic growth, these initiatives will pave the way for a stronger, more resilient workforce and business ecosystem.
