Singapore launched a slew of schemes to harness artificial intelligence, including tax breaks for companies and support for workers to learn AI skills.
Presenting the country’s Budget on Thursday, Prime Minister Lawrence Wong announced that Singapore will launch a “national AI council,” which he will chair.
“AI is a powerful tool — but it is still a tool. It must serve our national interests and our people,” he said.
Singapore will also define clear rules for how AI is developed and used to ensure it benefits society safely and responsibly, Wong added.
In terms of measures, Singapore will launch a new “Champions of AI” program to support firms who want to use AI to transform their business. Support will be tailored to each company, and will include enterprise transformation and workforce training.
“As these companies succeed, they will set benchmarks for their industries and inspire others to follow,” Wong said.
The country will also expand its Enterprise Innovation Scheme, which provides businesses with a 400% tax deduction on qualifying expenditures. Such expenditures will be expanded to include AI expenditures, capped at 50,000 Singapore dollars ($39,654) per year for 2027 and 2028.
Wong said that “every Singaporean can take the initiative to learn and pick up AI-related skills,” adding that the country will redesign its Skillsfuture website to make AI learning pathways clearer and easier to access, so that Singaporeans can quickly find courses that match their work needs and proficiency levels.
The Skillsfuture website provides learning opportunities and training support for Singaporeans, who are given credits to sign up for Skillsfuture courses when they turn 25.
But Wong noted that while most AI tools are free at the basic level, access to more advanced models require a paid subscription.
Singapore will then provide Singaporeans who take up selected AI training courses six months of free access to premium AI tools. “This will allow them to practise, experiment, and apply what they have learnt,” he pointed out.
While artificial intelligence is becoming a key driver of Singapore’s digital economy, adoption alone does not guarantee productivity gains, according to Jessica Zhang, senior vice president for APAC at business services provider ADP.
Without job redesign and practical training, the transition to AI risks widening skills gaps and undermining long-term talent development, Zhang added.
As such, she thinks the main challenge will be equipping workers with the skills to work effectively alongside AI, rather than simply introducing new tools.
“Accessible learning pathways, regular exposure to AI, and targeted upskilling that strengthens critical thinking, data literacy, and communication capabilities are likely to deliver greater impact than broad-based training alone.”
More funds to boost stock market
Separately, Wong also announced that the city-state will inject another 1.5 billion Singapore dollars ($1.18 billion) to boost its stock market.
This top-up to the Financial Sector Development Fund will also help to develop Singapore’s fund management industry, Wong announced.
The FSDF, set up in 1999, provides grants to firms and individuals in the financial services sector to promote Singapore as a financial center.
This comes as Singapore had announced a 5 billion Singapore dollars injection in 2025, known as the equity market development program, or EQDP, to boost the vibrancy of the local stock market.
The EQDP has been one of the factors behind the Straits Times Index’s rise in 2025. The STI climbed 22.67% in 2025, its largest gain since 2009.
SG$4 billion has already been placed with nine asset managers, and the remainder is expected to be deployed in the second quarter of 2026.
Wong also said that the government will look to implement other measures to boost the market, such as streamlining listing rules and requirements to make it easier for high-growth companies to go public and establishing a dual-listing bridge connecting the SGX and Nasdaq.
“These measures will enhance the depth and vibrancy of our public equities market and provide more pathways for enterprises to grow and scale from Singapore,” Wong said.
Klenn Yeo, Private Tax leader at Deloitte Singapore, said he expects the additional SG$1.5 billion to “turbo-charge liquidity in Singapore’s equities market,” adding that he expects an increase in privately-held high-growth companies in Southeast Asia to consider Singapore as their listing destination of choice in the coming years.
Fiscal position
Singapore has forecast a surplus of SG$8.5 billion for its 2026 financial year, which begins in April. This figure is smaller than the SG$15.1 billion surplus in its 2025 financial year.
Wong attributed the 2025 surplus to better-than-expected economic performance, as well as higher corporate income tax collections.
The country also saw higher asset-related revenue collections, such as from vehicle taxes and stamp duties. This was driven by strong demand for private vehicles and properties, Wong added.
Chua Hak Bin, regional co-head of research at Maybank Investment Banking Group said to CNBC the fiscal surplus was “prudent”, pointing out that as it is the first year of this government’s electoral term, the administration would want to preserve some “dry powder” in case of any unexpected shock or downturn.
Under the Singapore Constitution, an administration must maintain a balanced budget in each term of government and can only tap past reserves with presidential approval. The government is not allowed to borrow to fund its operating expenses.
Singapore only ever used its past reserves on two occasions: during the 2008 global financial crisis and the Covid-19 pandemic.
“Revenue projections are typically conservative, and like previous Budget forecasts, the actual fiscal surplus for FY2026 will likely come in higher, ” Chua added.
Source: CNBC