SINGAPORE: Companies in Singapore will receive a 50 per cent corporate income tax rebate in the 2025 year of assessment, Prime Minister and Finance Minister Lawrence Wong announced on Tuesday (Feb 18).
“Higher prices … affect our businesses, many of whom are grappling with the higher cost of rent and labour,” said Mr Wong in his Budget 2025 speech.
Eligible firms will also receive a cash grant of S$2,000 (US$1,500), even if they are not profitable. They must be active and have employed at least one local worker in 2024.
The total benefit that a company can receive – including both cash grant and rebate – will be capped at S$40,000.
The Ministry of Finance said eligible firms will automatically receive the money from the second quarter of 2025.
INCREASE IN GOVERNMENT CO-FUNDING
Mr Wong also announced that the government will provide more support for businesses increasing the salaries of lower-wage workers.
“Despite facing higher cost pressures, I’m glad that many businesses remain committed to uplifting the wages of lower-wage workers,” he said. “The government will continue to share this responsibility with employers.”
Under the Progressive Wage Credit scheme introduced in 2022, the government pays for part of the wage increase that an employer gives to workers.
This year, the government will increase its co-funding level to 40 per cent, up from 30 per cent. Next year, this will be 20 per cent, up from 15 per cent.
In 2024, the government’s co-funded level was 50 per cent.
The co-funding applies to workers whose average gross monthly wages were S$3,000 and under before the wage increase; and up to S$4,000 after the increase.
The average gross monthly increase must also be at least S$100 in each year.
If the wage increase in one year is sustained in the next, the government will co-fund the increase for both years, the Ministry of Finance said.
