<div id="readability-page-1"><div>Follow The Business Times’ live coverage of Singapore’s Budget 2026 here.[SINGAPORE] The Republic expects a fiscal surplus of S$8.5 billion or 1 per cent of gross domestic product (GDP) in its first Budget of the new government term, with the net investment returns contribution (NIRC) more than making up for a primary deficit.This is smaller than FY2025’s higher-than-expected S$15.1 billion surplus, but in line with economists’ expectations of a third consecutive planned surplus.“Our approach remains to keep the budget balanced over time, and across the ups and downs of the economic cycle,” said Finance Minister Lawrence Wong in his Budget speech on Thursday (Feb 12).Both operating revenue and total expenditure are expected to rise in FY2026, though the rise in spending will outstrip that of takings.Operating revenue is estimated at S$134.8 billion, 3 per cent higher than FY2025’s revised S$130.9 billion figure.Corporate income tax remains the biggest driver at S$37.8 billion, up S$2.5 billion or 7.2 per cent from the revised FY2025 figure.Collections are also up for major components such as personal income tax, goods and services tax and vehicle quota premiums.In percentage terms, the largest rises were for motor vehicle taxes – up 17.2 per cent to S$2.8 billion – and vehicle quota premiums, up 8.8 per cent to S$9.4 billion.Revenue is expected to fall for just three categories: statutory boards’ contributions; fees and charges, excluding vehicle quota premiums; and “other taxes”, comprising the land betterment charge and annual tonnage tax.The latter sees the largest estimated fall of 59 per cent, to S$1.6 billion.<h2>Higher spending</h2>Total expenditure, however, is expected to rise by 10.3 per cent to S$137.3 billion, or 16.3 per cent of GDP. Driving this increase is the Ministry of Trade and Industry, whose outlay is expected to rise by S$4.5 billion – or 68.5 per cent – to S$11.1 billion.This is on the back of initiatives to enhance Singapore’s economic competitiveness in an uncertain global environment.The second biggest bump comes from the Ministry of Health, with its spending set to rise by S$2.1 billion or 10.4 per cent to S$22.5 billion. This is due to increased subvention to public healthcare institutions; enhancement of long-term care subsidies and schemes; new healthcare facilities; and the Next Generation Electronic Medical Record system.Also seeing a major rise is the Ministry of Home Affairs’ budget, up S$2 billion or 21 per cent to S$11.7 billion. This is due to the progress of projects such as the Woodlands Checkpoint and Johor Bahru-Singapore Rapid Transit System Link. and higher grants to the Home Team Science &amp; Technology Agency.The Ministry of Defence continues to have the biggest individual ministry budget at S$24.9 billion. In his Budget speech, PM Wong noted that Singapore expects “overall security-related expenditures to rise in the coming years”.<h2>Closing the deficit</h2>The difference between operating revenue and total expenditure yields a primary deficit of S$2.6 billion for FY2026. After special transfers, this widens to a basic deficit of S$5.4 billion.But S$28.5 billion in NIRC – up S$0.95 billion or 3.4 per cent from FY2025 – helps to take Singapore to an overall budget surplus of S$4.2 billion.The final overall fiscal surplus of S$8.6 billion also takes into account the Significant Infrastructure Government Loan Act, under which the capitalisation of nationally significant infrastructure is projected to be S$5.02 billion.The fiscal impulse, which measures whether the government is injecting more or less into the economy compared to the previous year, is projected to be mildly expansionary at 0.6 per cent of GDP.For more of BT’s Budget 2026 coverage, go to bt.sg/budget26</div></div>

Singapore anticipates a fiscal surplus of S$8.5 billion for FY2026, down from S$15.1 billion in FY2025. The surplus is attributed to net investment returns, despite a primary deficit of S$2.6 billion. Operating revenue is projected to rise to S$134.8 billion, driven by corporate income tax, while total expenditure is expected to increase by 10.3% to S$137.3 billion. Key spending increases are noted in the Ministry of Trade and Industry and the Ministry of Health. The overall fiscal surplus, including infrastructure loans, is projected at S$8.6 billion.

- Singapore anticipates an S$ 8.5 billion budget surplus for 2026, amounting to 1% of GDP, despite a decrease from the prior year's surplus of S$ 15.1 billion.  
- The expected operational revenue is S$ 134.8 billion, increasing 3% from the previous year, driven largely by corporate income tax, while total expenditures are projected to rise by 10.3% to S$ 137.3 billion.  
- The disparity between income and expenditure will result in a primary deficit, but net investment returns will help achieve an overall budget surplus of S$ 8.6 billion, considering major infrastructure financing impacts.

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Singapore expects smaller S$8.5 billion surplus in FY2026