Government support continues to play a pivotal role in Singapore’s business landscape, with more companies actively tapping into budget initiatives. According to the United Overseas Bank’s (UOB) Business Outlook Study 2025 (SMEs & Large Enterprises), a record 83% of businesses either applied for or planned to apply for government support in 2024—an increase from 78% in 2023. This growing reliance on assistance spans across industries and business sizes, reflecting the importance of these initiatives in sustaining growth and innovation.
Medium enterprises led the charge, with 446 businesses seeking support, followed by 350 small enterprises and 104 large enterprises. Among industries, the healthcare and medical services sector showed the highest engagement, with 92% of businesses leveraging government initiatives, while manufacturing and engineering firms followed closely at 90%.
Despite strong participation, 17% of businesses have yet to engage with budget initiatives, with 41% unsure about which programs are relevant, 30% deterred by the time-consuming application process, and 23% believing they do not need government support. However, awareness of key programs is growing, with 29% of businesses familiar with the SkillsFuture Enterprise Credit and 21% recognizing the Progressive Wage Credit Scheme.
As we enter 2025, the Singapore government continues to refine and expand its support measures, ensuring businesses of all sizes can navigate economic challenges, drive innovation, and enhance workforce development. This guide provides an overview of the key grants and initiatives available in 2025, helping businesses make informed decisions on leveraging government support.
Grants and Initiatives for Businesses in 2025
Corporate Tax Relief
The 50% corporate income tax rebate introduced in Singapore’s 2025 Budget is indeed a significant measure aimed at providing relief to businesses facing economic challenges. Here’s a more detailed elaboration of this initiative:
Corporate Tax Relief Details
The corporate income tax rebate for the Year of Assessment 2025 offers substantial benefits to companies:
- A 50% rebate on corporate income tax payable
- Eligible companies will receive a minimum cash grant of S$2,000
- The rebate is capped at S$40,000 per company
Eligibility Criteria
To qualify for the minimum cash grant of S$2,000, companies must meet the following criteria:
- Be an active company
- Have employed at least one local employee in the calendar year 2024
- The local employee condition is met if the company has made CPF contributions for at least one Singaporean citizen or permanent resident
Implementation Timeline
The Singapore government has planned a swift rollout of this relief measure. Eligible companies will automatically receive the benefits starting from the second quarter of calendar year 202525
Impact on Businesses
This tax rebate is designed to provide immediate financial relief to businesses, particularly beneficial for:
- SMEs grappling with rising business costs
- Companies facing higher rent and labour expenses
- Both profitable and non-profitable firms, even companies not making a profit can benefit from the minimum cash grant
Strategic Objectives
The corporate tax rebate serves several strategic purposes:
- Helps businesses manage cash flow needs as they adjust to structurally higher costs
- Enables companies to focus on productivity improvements and explore new opportunities
- Provides broad-based support to businesses across various sectors
This comprehensive tax relief measure demonstrates the Singapore government’s commitment to supporting businesses during challenging economic times, while also encouraging growth and innovation in the corporate sector.
Driving Innovation and R&D Growth
Singapore’s commitment to driving innovation and R&D growth in 2025 is evident through substantial investments and strategic initiatives. The government’s allocation of over S$10 billion for research, development, and infrastructure investments underscores its dedication to maintaining Singapore’s position as a global innovation hub.
National Productivity Fund (NPF)
The Singapore government has announced a S$3 billion top-up to the National Productivity Fund (NPF) as part of Budget 2025, reinforcing its commitment to enhancing productivity and innovation. This substantial investment is designed to strengthen Singapore’s global competitiveness by driving research, technological advancements, and business transformation.
Key Focus Areas
- Research & Development (R&D): Funding will support R&D efforts across various industries, with a strong emphasis on emerging technologies.
- Artificial Intelligence & Cloud Computing: A significant portion of the fund will be directed towards AI and cloud computing, recognizing their crucial role in future economic growth.
- Innovation Support: Programs such as the Productivity Solutions Grant (PSG) and SME Go Digital will continue to receive funding, helping businesses adopt innovative solutions and digital tools.
Impact on Key Sectors
- Technology & Semiconductor Industry: Companies in semiconductor and high-tech manufacturing are expected to benefit, including AEM Holdings, which specializes in high-end outsourced assembly and test (OSAT) services.
- Life Sciences & Medical Technology: Firms with exposure to these segments, such as Venture, Grand Venture, and Frencken, are well-positioned to gain from the NPF boost.
Long-Term Vision
- This NPF enhancement aligns with Singapore’s strategic goals to:
- Maintain its status as a global innovation hub
- Strengthen capabilities in biotechnology & semiconductor research
- Encourage SMEs to adopt cutting-edge technologies
By focusing on productivity and technological advancement, Singapore aims to drive sustainable economic growth and stay ahead in an increasingly tech-driven global economy.
Enterprise Compute Initiative
As part of Budget 2025, Singapore has unveiled the S$150 million Enterprise Compute Initiative, a strategic move to accelerate AI adoption and advanced computing solutions among businesses, with a strong focus on small and medium-sized enterprises (SMEs). This initiative aims to drive innovation, enhance productivity, and strengthen Singapore’s position in the global digital economy.
Key Features of the Enterprise Compute Initiative
- Partnerships with Cloud Providers: Eligible businesses will collaborate with major cloud service providers, gaining access to cutting-edge AI tools and computing power.
- Access to AI-Powered Resources: Companies will benefit from high-performance computing resources, AI-driven tools, and expert consultancy services.
- Empowering SMEs: By reducing cost and complexity barriers, the initiative levels the playing field, allowing SMEs to leverage powerful AI solutions.
- Customized AI Solutions: Recognizing the need for business-specific AI integration, the program offers tailored solutions to optimize operations and decision-making.
- Complementary Support: This initiative works alongside existing government programs like the Productivity Solutions Grant (PSG) and SMEs Go Digital, reinforcing Singapore’s commitment to digital transformation.
The Enterprise Compute Initiative is a key pillar of Singapore’s broader strategy to future-proof businesses through AI-powered transformation. By equipping enterprises with the right tools, expertise, and computing capabilities, Singapore aims to drive economic growth, enhance its global competitiveness, and ensure businesses are ready to thrive in an AI-driven world.
Workforce Development and Skills Enhancement
Singapore has ramped up its workforce development and skills enhancement initiatives for 2025, reinforcing its commitment to building a highly skilled workforce while driving business growth. The latest enhancements focus on upskilling, job redesign, and sustainable wage growth, ensuring businesses can remain competitive in an evolving economic landscape.
Enhanced SkillsFuture Enterprise Credit (SFEC)
The SFEC has been redesigned to offer more comprehensive and accessible support for workforce development and enterprise transformation:
- Increased Credit: Eligible companies will receive a one-time S$10,000 credit to support training initiatives.
- Higher Coverage: The credit can offset up to 90% of out-of-pocket expenses for approved courses and transformation programs.
- Extended Expiry Date: Companies now have until June 30, 2025, to utilize the credit.
- Simplified Access: The credit functions like an online wallet, allowing businesses to track their balance and use funds instantly.
- Redesigned SkillsFuture Enterprise Credit: Starting in the second half of 2026, all companies with at least three resident employees will receive a fresh S$10,000 credit, valid for three years.
SkillsFuture Workforce Development Grant
This new grant streamlines multiple workforce support schemes, making it easier for businesses to access funding for training and development:
- Unified Application: Merges programs from Workforce Singapore (WSG) and SkillsFuture Singapore (SSG) into a single application process.
- Higher Funding: Covers up to 70% of costs for job redesign and workforce transformation projects.
- Comprehensive Support: Encourages companies to invest in upskilling employees and modernizing job roles for greater efficiency.
Progressive Wage Credit Scheme (PWCS)
The PWCS has been enhanced to support sustainable wage growth and employee retention:
- Higher Co-Funding: The government will now co-fund 40% of wage increases in 2025, up from 30%.
- Extended Support: The 40% co-funding will also apply to wage increases given in 2024 and maintained in 2025.
- Future Commitment: Co-funding for 2026 wage increases will rise from 15% to 20%.
- Eligibility: This applies to wage increases for Singapore Citizens and Permanent Residents earning up to S$3,000 in gross monthly wages.
Additional Workforce Development Initiatives
Singapore is also introducing new measures to support individuals and businesses in upskilling efforts:
- SkillsFuture Level-Up Programme: Launching in mid-March 2025, this initiative offers training allowances of up to S$3,000 per month for selected full-time courses, with support for up to 24 months. Additionally, starting in early 2026, employees in part-time training can receive an S$300 monthly allowance. Designed to provide stronger structural support, this program aims to help mid-career Singaporeans aged 40 and above undergo significant skills upgrading and remain competitive in a rapidly evolving economy.
- The Workfare Skills Support scheme: Designed for lower-wage workers aged 30 and above, this scheme provides a training allowance of up to 50% of their average monthly income for full-time training and a S$300 monthly allowance for part-time courses.
- NTUC Company Training Committee (CTC) Grant: An additional S$200 million has been allocated to company-led training initiatives to help businesses upgrade their workforce.
Financing and Market Expansion Support
Singapore has significantly strengthened its Financing and Market Expansion Support initiatives to help businesses scale and enter new markets. Here’s a breakdown of the key programs:
New S$1 Billion Private Credit Growth Fund
To address financing gaps for high-growth local enterprises, the Singapore government has introduced a S$1 billion Private Credit Growth Fund. This initiative aims to support companies that may struggle with traditional funding options, particularly those in the technology and scalability sectors.
Key Features:
- Tailored Financing: Offers customized funding solutions to meet the needs of fast-growing local businesses.
- Complementary to Existing Options: Serves as an alternative to bank loans and equity financing, providing a flexible and cost-effective option.
- Focus on Tech-Driven Growth: Prioritizes companies with strong technological capabilities and scalability potential.
- Strengthening Singapore’s Financing Ecosystem: Encourages more private credit players to enhance Singapore’s position as a leading capital market hub.
Market Readiness Assistance (MRA) Grant
The Market Readiness Assistance (MRA) Grant remains a crucial support tool for Singapore businesses seeking international expansion, providing substantial financial assistance. The enhanced grant cap of up to S$100,000 has been extended until March 31, 2026, ensuring continued support for companies looking to enter new markets.
Key Aspects:
- Funding Support: Covers up to 50% of eligible costs, capped at S$100,000 per new market.
Eligible Activities:
- Overseas Market Promotion (up to S$20,000)
- Overseas Business Development (up to S$50,000)
- Overseas Market Set-Up (up to S$30,000)
Eligibility Criteria:
- Must be registered and operating in Singapore.
- At least 30% local equity ownership.
- The company must be new to the target overseas market (with annual sales not exceeding S$100,000 in the past three years).
- Group Annual Sales Turnover ≤ S$100 million OR Group employment size ≤ 200 employees.
Sector-Specific Growth and Sustainability Initiatives
Singapore’s Budget 2025 introduces strategic sector-specific initiatives to boost economic growth, enhance sustainability, and strengthen financial markets.
Future Energy Fund:
The government’s S$5 billion top-up to the Future Energy Fund underscores its commitment to energy transition and sustainable development.
- Clean Power Infrastructure: Investments in next-generation power generation and distribution to accelerate Singapore’s shift toward renewable energy.
- Energy Resilience: Strengthening domestic energy security through clean energy development.
- Exploring Nuclear Energy: Research into Small Modular Reactors (SMRs) with advanced safety features to assess nuclear energy’s feasibility in Singapore.
- Regional Collaboration: Supporting initiatives to import low-carbon electricity from neighboring countries.
New Tax Incentives to Strengthen Singapore’s Financial Sector
To revitalize Singapore’s stock market and attract high-value investments, Budget 2025 introduces new tax incentives for fund managers.
Enhanced Financial Sector Incentive – Fund Manager (FSI-FM) Scheme
- Lower Tax Rate: Qualifying fund managers will enjoy a reduced 5% tax rate on qualifying income.
- Singapore Exchange Listing Requirement: Fund managers or their holding companies must obtain a primary listing on a Singapore exchange and remain listed for five years.
- Profit Distribution: A portion of earnings must be distributed as dividends.
- Minimum Business Requirements: Fund managers must meet specified criteria for professional headcount and assets under management (AUM).
Tax Exemption for Qualifying Income
- Singapore-Listed Equities Focus: A corporate tax exemption applies to management and advisory fees earned from funds that invest substantially in Singapore-listed equities.
- Investment Thresholds: New funds must invest at least 30% of their AUM in Singapore-listed equities while existing funds must meet this threshold and maintain annual net inflows.
- Limited Duration: The tax exemption is available for a non-renewable period of five years per fund.
By focusing on clean energy advancements and strengthening financial markets, Budget 2025 reinforces Singapore’s position as a resilient, future-ready economy poised for global competitiveness.
Attracting Global Talent and Entrepreneurship
Global Founder Programme
The Global Founder Programme, launched by the Singapore Economic Development Board (EDB), is a strategic initiative designed to attract international entrepreneurs and startups to Singapore. This initiative reinforces the city-state’s status as a premier hub for innovation and entrepreneurship.
Key Features of the Global Founder Programme
- Launch Timeline: Set to launch in late 2025, with applications opening in April 2025.
- Target Audience: Experienced entrepreneurs and global companies with the potential to build high-value ventures.
- Objective: To encourage global founders to establish and scale their startups in Singapore.
Benefits for Participants
- Access to a Thriving Startup Ecosystem: Entrepreneurs gain entry into Singapore’s dynamic tech and innovation network.
- Government Support: Likely to include assistance such as the EntrePass scheme for foreign startup founders.
- Networking Opportunities: Connect with local and international businesses, investors, and industry experts to accelerate innovation.
Conclusion
The 2025 Budget highlights Singapore’s strong commitment to supporting businesses at every stage of growth, across all sectors. With enhanced tax relief, innovation funding, workforce development programs, and sector-specific initiatives, companies now have ample opportunities to scale, innovate, and navigate economic uncertainties with confidence.
As Singapore transitions from the high government dependence seen in 2024 to a more strategic and sustainable support framework in 2025, businesses are encouraged to capitalize on these grants and incentives to boost their competitiveness, foster innovation, and contribute to the nation’s long-term economic resilience.
For businesses looking to take advantage of these opportunities, detailed information and application guidelines are available on the GoBusiness Singapore portal. It’s important to review the eligibility criteria and ensure all required documentation is in order for a smooth application process.
Need help navigating business grants and compliance? HeySara provides expert corporate services to streamline your application process, ensuring you maximize government incentives with ease. Contact HeySara today to get started!
