Singapore Budget 2026 introduces another important recalibration of foreign manpower policy. From 1 January 2027, the minimum qualifying salary for new Employment Pass (EP) and S Pass applications will increase, with renewal applications following from 1 January 2028.
At the same time, the Local Qualifying Salary (LQS) will increase from S$1,600 to S$1,800 from 1 July 2026, and support for lower wage workers under the Progressive Wage Credit Scheme (PWCS) will be enhanced.
For employers, this is not just a hiring update. It directly affects workforce planning, salary benchmarking, payroll compliance, and budgeting. Companies that wait until late 2026 to respond may face avoidable hiring friction or renewal challenges.
Under Singapore Budget 2026, the qualifying salary thresholds for foreign professionals will increase.
For new EP applications from 1 January 2027:
For new S Pass applications from 1 January 2027:
Renewal applications for both passes will apply the new thresholds from 1 January 2028.
Singapore’s work pass system uses progressive salary benchmarks based on the applicant’s age.
For Employment Pass applicants outside financial services, the salary threshold rises progressively from age 23, reaching S$11,500 for applicants aged 45 and above, compared with S$10,700 previously.
For financial services sector EP applicants, the benchmark increases to S$12,700 for applicants aged 45 and above, compared with S$11,800 previously.
For S Pass applicants outside financial services, the qualifying salary increases progressively up to S$5,100 for applicants aged 45 and above.
These benchmarks help maintain a high-quality foreign workforce while ensuring that foreign professionals complement the local workforce rather than substitute it.
Another key change under Singapore Budget 2026 is the increase in the Local Qualifying Salary (LQS).
From 1 July 2026, the LQS will increase:
Employers hiring foreign workers must ensure that their full-time local employees earn at least the LQS.
This requirement means foreign manpower planning must be aligned with local wage compliance.
Singapore Budget 2026 also strengthens support for lower wage workers through the Progressive Wage Credit Scheme (PWCS).
Key changes include:
At the same time, the minimum qualifying wage increase required to receive PWCS support will increase from S$100 to S$200 from 2027 onwards.
The scheme helps employers adjust to wage increases while supporting income growth for lower wage workers.
The salary threshold increases under Singapore Budget 2026 will influence hiring decisions, workforce composition, and payroll budgeting.
For companies that rely on foreign professionals, the new thresholds increase the minimum salary required for new hires. Roles that previously qualified for EP or S Pass at lower salary levels may need to be restructured or reevaluated.
Renewal planning is another key consideration. Companies should review employees whose work passes expire from 2028 onwards, as their salaries may need to be adjusted to meet the new qualifying thresholds.
Another implication is cost planning. Higher salary benchmarks combined with rising local wage floors may increase payroll expenditure across both foreign and local employees.
Managing manpower policy changes requires coordination across payroll, HR, and tax functions.
At ATHR, we support companies with payroll structuring, workforce compliance checks, and accounting alignment to ensure that manpower strategies remain compliant with Singapore regulations.
If your company is preparing for EP and S Pass salary changes in 2027, early planning will ensure smoother hiring, compliant payroll processes, and better cost control. Learn more about our Employment Pass and Payroll Management services.
As a leading corporate service provider in Singapore, our team offers comprehensive incorporation, accounting, payroll management, and corporate secretarial services to help your business navigate regulatory requirements and maximise available incentives. Contact us today to learn how we can support your business growth journey.
The ATHR Content Team is a group of professional writers from Singapore and the Philippines, committed to delivering informative, practical, and engaging content for business owners across Southeast Asia.
