Prime Minister and Finance Minister Lawrence Wong declared on Tuesday, February 18, that Singaporean companies would be eligible for a 50 percent corporate income tax refund in the 2025 assessment year.
As reported by CNA, Wong in his Budget 2025 speech said, “Higher prices … affect our businesses, many of whom are grappling with the higher cost of rent and labour.”
A monetary grant of S$2,000 (US$1,500) will also be given to eligible businesses, regardless of their profitability. In 2024, they must still be in operation and have at least one local employee.
A company’s total benefit, which includes both a cash award and a rebate, will not exceed S$40,000.
According to the Ministry of Finance, qualified businesses would start receiving the funds in the second quarter of 2025. Wong further declared that the government will increase its assistance to companies that raise the wages of lower-paid employees.
He said, “Despite facing higher cost pressures, I’m glad that many businesses remain committed to uplifting the wages of lower-wage workers,” adding, “The government will continue to share this responsibility with employers.”
A portion of the wage rise that a firm provides to employees is covered by the government under the Progressive Wage Credit program, which was implemented in 2022. The government will raise its co-funding percentage from 30% to 40% this year. This will rise from 15% to 20% the next year.
The level of government co-funding was 50% in 2024. Workers whose average gross monthly wages were S$3,000 or less prior to the wage rise and up to S$4,000 following the increase are eligible for co-funding.
Additionally, the annual average gross monthly growth must be at least S$100.
According to the Ministry of Finance, the government will co-fund the pay boost for both years if it is maintained in the following year.
