Singapore launches US$780 million package as Iran war drives up costs
Cash payouts, fuel vouchers and a 50% tax rebate will cushion households and firms as ministers warn the Middle East war may slow growth.
- Singapore is deploying a US$780 million (S$1 billion) relief package to address rising costs driven by the conflict in the Middle East.
- The package includes direct cash payments for eligible Singaporeans and fuel vouchers for taxi and private-hire drivers.
- Support for businesses will be provided through an increased corporate tax rebate, which will be raised from 40% to 50%.
- The government stated these measures are a direct response to higher energy prices resulting from the war.
Singapore said it will deploy close to S$1 billion (US$780 million) in relief after the Middle East conflict sent energy prices higher, with cash payments, fuel vouchers and a stronger tax rebate at the centre of the package.
Senior Minister of State for Finance Jeffrey Siow said on Tuesday (April 7) that the measures, introduced in response to the Iran war, were larger than the support rolled out after Russia invaded Ukraine in 2022, another crisis that also pushed fuel prices higher.
Eligible Singaporeans will receive cash handouts. Fuel vouchers will go to car-hire platform workers, private-hire car drivers and taxi drivers. Companies, meanwhile, will get a corporate tax rebate of 50%, up from the 40% announced in the FY2026 budget in February.
“We do not know how long the conflict and its economic impact will last, but the government is alive to the situation,” Siow said.
Deputy Prime Minister Gan Kim Yong said early data showed economic activity remained resilient in the first quarter of 2026, although the conflict was likely to affect growth. Singapore’s trade ministry has forecast growth of 2% to 4% this year, and Gan said any revision would be announced after the regular review next month.
On energy security, Coordinating Minister for National Security K Shanmugam said Singapore relies on imported natural gas for 95% of its electricity generation, with 9% of this year’s needs expected to come from Qatar. He said the country had not drawn on its reserves of natural gas and diesel, but was considering increasing them even though doing so would be costly.
Shanmugam also said Singapore had continued to meet both domestic fuel demand and its international obligations. He noted that the city-state remained the world’s third-largest oil trading hub and the sixth-largest refinery export hub.
“It keeps Singapore relevant in the international energy trade, and this has enabled us to have continued access to crude oil,” he said.
In February, Singapore forecast a fiscal surplus of S$8.5 billion for FY2026, which runs from April to March.
(US$1 = S$1.28)
Reuters
