Driving artificial intelligence (AI) adoption and responding to the Economic Strategy Review (ESR) committees’ recommendations were among the themes of Prime Minister and Finance Minister Lawrence Wong’s Budget speech.

The speech also outlined Singapore’s long-term economic strategy, including measures to cultivate a resilient and skilled workforce, and bolster support for families and lower-income households.

Here are nine key announcements PM Wong made on Thursday (Feb 12), in his first Budget since the 2025 General Election.

1. Accelerating AI adoption

How Singapore harnesses AI will be a “decisive factor for success” in a changed world, said PM Wong. To accelerate adoption, new programmes will be introduced and existing schemes enhanced.

A new National AI Council, chaired by PM Wong, will drive Singapore’s AI agenda, while national AI Missions will transform four key sectors: advanced manufacturing, connectivity, finance and healthcare. This involves reviewing regulations and creating sandboxes for safe AI testing.

A “Champions of AI” programme will support firms seeking to comprehensively transform their businesses through AI, including enterprise transformation and workforce training.

The Enterprise Innovation Scheme will be expanded to include AI expenditure as a qualifying activity, and the Productivity Solution Grant will support a wider range of digital and AI-enabled solutions.

A larger AI park will be established at One-North, building on the Lorong AI pilot at Cross Street, to catalyse ideas and forge collaborations.

For workers, there will be help for them to build practical AI capabilities. As a start, a tech skills accelerator will equip legal and accountancy professionals with AI capabilities.

2. Making it easier to go global

Businesses will get more support to venture abroad for growth.

Small and medium-sized enterprises (SMEs) will get up to 70 per cent funding support, while non-SMEs will get up to 50 per cent for existing internationalisation schemes.

The Market Readiness Assistance grant will be enhanced to help enterprises access new markets and deepen presence in existing ones.

More internationalisation activities will be eligible for t double tax deduction , with the claims ceiling raised to S$400,000 from S$150,000 per Year of Assessment.

The maximum loan quantum for trade and ixed asset under the Enterprise Financing Scheme will be increased for greater financing flexibility.

3. Catalysing growth capital

Start-ups have better access to early-stage funding than a decade ago, yet many still struggle at the growth stage. Globally, growth-stage capital has tightened. More will be done in this area.

The Startup SG Equity scheme will receive a S$1 billion injection, with its scope expanded from early-stage funding to include growth-stage companies.

For more mature high-growth start-ups seeking public listings, a fresh S$1.5 billion tranche of the Anchor Fund will be launched, co-invested between the government and Temasek.

The Financial Sector Development Fund will be topped up with S$1.5 billion to continue supporting efforts to revitalise Singapore’s equity market, building on the encouraging momentum so far.

4. Foreign worker policy tweaks

Further refinements to foreign worker policies were announced.

To keep pace with rising local wages, minimum qualifying salaries for Employment Pass (EP) and S Pass holders will be increased. For EP holders, it will rise to S$6,000 from S$5,600, or S$6,600 from S$6,200 for those in the financial sector.

For S Pass holders, the minimum will rise to S$3,600 from S$3,300, or S$4,000 from S$3,800 for the financial sector.

Qualifying salaries for older EP and S Pass applicants will be raised in tandem. This will take effect for new applicants from January 2027, and renewals from 2028.

Work permit levies will also be adjusted. Levies for “basic-skilled” workers in the marine and process sectors will rise by S$100 and S$150 respectively, while the levy structure for manufacturing and services will be simplified. These changes kick in from 2028.

Separately, the Local Qualifying Salary for local workers in companies employing foreign workers will rise to S$1,800 from S$1,600 this year.

5. CPF members get new investment option

Central Provident Fund (CPF) members will get more investment options to grow their savings under a new voluntary investment scheme.

This is for members with a longer runway to retirement who are prepared to take on more risk for potentially higher returns.

The scheme will use a life-cycle investment approach, where younger members can take on more risk, with investments rebalanced towards safer assets as they approach retirement.

Fees will be kept low, and two to three credible providers will be selected to keep choices simple.

6. Higher vehicle taxes

To encourage early deregistration of conventional petrol cars and encourage the adoption of electric vehicles, the Preferential Additional Registration Fee (PARF) will be reduced by 45 percentage points and the PARF rebate cap will be lowered to S$30,000, from S$60,000.

The changes will apply to all cars with Certificates of Entitlement obtained from the next bidding exercise.

7. More vouchers to east cost pressures

Despite easing inflation, Singaporeans still face cost anxieties, noted PM Wong.

To cushion the impact, all Singaporean households will receive a further S$500 in Community Development Council (CDC) vouchers in January 2027.

There will also be a one-off Cost-of-Living Special Payment of S$200 to S$400 in cash for Singaporean adults earning up to S$100,000 in Assessable Income who do not own more than one property.

Eligible households will get additional U-Save rebates for utilities, whilst families with children will receive another S$500 in LifeSG credits per child aged 12 and below.

8. Carbon tax may stay slower for longer

Singapore is assessing its carbon tax trajectory carefully in light of international developments.

Should the global climate momentum continue to weaken, the tax may be set at the lower end of the S$50 to S$80 per tonne range by 2030.

This means Singapore’s path to net zero will depend heavily on technological breakthroughs and international cooperation and may be uneven, said PM Wong.

Still, concrete steps have been taken to cut emissions. The national solar deployment target will be raised to 3 gigawatt-peak by 2030 from 2 gigawatt-peak, which Singapore has already achieved.

The Energy Efficiency Grant and Enterprise Finance Scheme for businesses will also be extended.