Singapore ended the fiscal year 2025 with a surplus of $15.1 billion, or 1.9% of the country’s total gross domestic product (GDP), says Prime Minister and Finance Minister Lawrence Wong at Budget 2026.
Revised overall expenditure for the year was up by 0.1% to $143.29 billion compared to the estimated figure of $143.10 billion. The figure comprises total (ministry) expenditure, special transfers including top-ups to statutory and trust funds and including the impact of the Significant Infrastructure Government Loan Act (SINGA).
FY2025 revenue, which comprises operating revenue and net investment returns contribution (NIRC), rose by 5.7% or $8.48 billion to $158.39 billion, or 19.8% of GDP.
Operating revenue grew by 6.6% y-o-y to $130.86 billion, mainly due to higher collections from corporate income tax, vehicle quota premiums, other taxes (land betterment charge and annual tonnage tax), stamp duty and contributions from statutory boards.
Corporate income tax collections stood at $35.24 billion, 7.9% or $2.57 billion higher than the estimated FY2025 figure due to better-than-expected economic growth in 2024. The figure contributed 4% to overall GDP, which is “significantly higher” than in past years.
Vehicle quota premiums also stood 31.1% or $2.06 billion higher than the estimated figure at $6.66 billion, due to higher-than-expected premiums.
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Other taxes are revised to $3.98 billion, 67.8% or $3.98 billion higher than the estimated FY2025 figure.
Smaller surplus expected in FY2026
For FY2026, Wong expects the government to report a smaller surplus of $8.5 billion or 1% of GDP.
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“Our approach remains to keep the budget balanced over time, and across the ups and downs of the economic cycle,” he says.
Singapore’s budgets have grown larger in the past 10 years, with the country spending $77.8 billion in FY2015, 84% lower compared to FY2025.
According to Singapore’s laws, the government must balance the budget within its term of office.
Higher corporate tax collections expected from FY2027
The government will proceed with the implementation of the top-up tax under Pillar Two of BEPS or base erosion and profit shifting.
The move will raise the effective tax rate for large multinational enterprises operating in Singapore to 15%, in which the government expects higher corporate tax collections from FY2027 onwards
