Key takeaways for business and investment from the Singapore Budget 2026

Key takeaways for business and investment from the Singapore Budget 2026

Singapore's Budget 2026, delivered by Prime Minister Lawrence Wong on 12 February, outlines the government's strategy to strengthen the economy, support businesses, and position Singapore as a competitive hub for talent, capital, and innovation. Here are the key measures relevant to businesses, investors, and professionals operating in Singapore.

Corporate tax relief

Businesses will receive a 40 per cent corporate income tax rebate for the Year of Assessment 2026. Every active company that employed at least one local worker in 2025 will qualify for a minimum benefit of S$1,500, capped at S$30,000 per firm.

This short-term relief measure addresses cost pressures whilst broader economic restructuring efforts continue. Companies should factor this rebate into their 2026 tax planning.

Employment Pass and S Pass threshold increase

To maintain the quality of foreign talent whilst strengthening the local workforce, the minimum qualifying salary for new Employment Pass (EP) applicants will rise from S$5,600 to S$6,000 with effect from 1 January 2027. For the financial services sector, which typically commands higher wages, the threshold increases from S$6,200 to S$6,600.  

For S Pass holders, the minimum qualifying salary will be raised from S$3,300 to S$3,600 with effect from 1 January 2027. In the financial services sector, the minimum qualifying salary will be increased to S$4,000.  

The revised salary requirement will apply to both EP and S Pass renewal applications from 1 January 2028.

Employers should review their current and planned hiring strategies, particularly for roles where salaries are near the current thresholds. This may affect recruitment timelines and compensation structures for foreign hires.

Enhanced support for internationalisation

Singapore is increasing support for companies expanding overseas:

• Grant scheme enhancements: Support levels will increase to up to 70 per cent for SMEs and up to 50 per cent for non-SMEs undertaking internationalisation activities.

• Market Readiness Assistance: The grant will now support not just market entry but deeper activity in existing markets, allowing companies to scale their international operations.

• Double Tax Deduction for Internationalisation: The cap increases from S$150,000 to S$400,000, with more qualifying activities to be added. This provides significant tax relief for companies pursuing overseas expansion.

• Enterprise Financing Scheme: Maximum loan quantum for trade and fixed asset loans will increase, giving firms greater flexibility in financing international operations.

These measures make Singapore an attractive base for regional and global expansion strategies.

Capital market development

Singapore continues efforts to deepen its capital markets and support companies at every stage of growth.

Key initiatives include:

• Streamlined listing processes

• A dual listing bridge connecting SGX and Nasdaq

• Measures to attract high-quality listings

• Enhanced support for high-growth companies with strong fundamentals

The Economic Development Board will focus on anchoring companies with the potential to become future industry leaders, creating a comprehensive enterprise ecosystem from startups through to large firms.

For companies considering fundraising or listing options, Singapore's evolving capital market infrastructure offers increasingly competitive pathways.

National AI strategy

Singapore is taking a coordinated national approach to artificial intelligence, viewing it as a strategic advantage in overcoming constraints such as limited natural resources, an ageing population, and a tight labour market.

The government will define clear rules for AI development and deployment to ensure it benefits society safely and responsibly. This national-level coordination moves beyond isolated pilots to systematic implementation across sectors.

Companies operating in Singapore should consider how AI integration aligns with their operations and how national-level infrastructure and standards may support their technology adoption.

Trade agreements and regional integration

Singapore continues expanding its network of international agreements:

• The EU-Singapore Digital Trade Agreement entered into force on 1 February 2026

• The Future of Investment and Trade Partnership has launched

• An agreement with New Zealand on essential supplies will be signed this year

Regional integration projects include the Johor-Singapore Special Economic Zone and enhanced cooperation with Indonesia's Batam, Bintan and Karimun Free Trade Zones.

Singapore is also strengthening ties with fast-growing markets in Latin America, Africa, and the Middle East through new embassies and increased economic presence.

These developments create opportunities for businesses using Singapore as a regional hub to access new markets and supply chains.

Sustainability initiatives

Singapore is advancing green transition in key sectors:

• Aviation: From 2026, 1 per cent of all fuel used for flights departing Singapore must be sustainable aviation fuel.

• Maritime: The government is partnering with industry to develop low-carbon ammonia bunkering solutions on Jurong Island. If successful, Singapore could become one of the first countries to supply ammonia commercially as shipping fuel.

• Companies in aviation, maritime, and related sectors should prepare for evolving sustainability requirements and consider opportunities in green technology and services.

Implications for Alpadis clients

• For corporate clients: The corporate tax rebate provides immediate relief, whilst enhanced internationalisation support creates opportunities for overseas expansion. Companies should review their regional strategies and consider how Singapore's improved market access and financing support can facilitate growth.

• For family offices and investors: Capital market developments and the focus on high-growth companies may create new investment opportunities in Singapore's evolving enterprise ecosystem. The strengthened SGX-Nasdaq bridge offers enhanced access to both Asian and US markets.

• For employment and HR matters: The EP threshold increase from January 2027 requires advance planning for companies hiring foreign professionals. Employers should review compensation structures and recruitment timelines now to ensure compliance and competitiveness.

• For businesses considering Singapore establishment: The combination of tax relief, internationalisation support, capital market access, and expanding trade agreements reinforces Singapore's position as a business hub. The national AI strategy and coordinated infrastructure development provide additional attractions for technology-enabled businesses.

Alpadis Singapore provides corporate secretarial services, company formation, HR and payroll support, and regulatory compliance assistance to help businesses navigate Singapore's evolving landscape. Contact us to discuss how Budget 2026 measures may affect your operations or expansion plans.

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