More near-term help is under way to help companies cope with cost pressures.
The Wage Credit Scheme will be extended for three more years in a $1.8 billion package.
The scheme subsidises pay rises for Singaporean employees earning up to $4,000 a month. Firms will now have access to 20 per cent co-funding for 2018, the same as in the past two years. This co-funding will taper off to 15 per cent for 2019, and 10 per cent for 2020.
It is expected that the Government will pay out more than $800 million to over 90,000 firms for 2017 for wage increases given to more than 600,000 employees.
In addition, the corporate income tax rebate for companies will be doubled this year to 40 per cent of tax payable, capped at $15,000, up from $10,000.
The rebate is also being extended to the fiscal year 2019, though at a lower rate of 20 per cent and with a limit of $10,000.
These changes will cost the Government an additional $475 million over the two years.
Finance Minister Heng Swee Keat said: "The enhancement and extension will benefit all tax-paying companies, especially smaller ones."
The earlier-announced increases to foreign worker levy rates will be deferred for another year for the shipyard and process sectors, which continue to face weakness.
The Work Trial scheme will be upgraded into a Career Trial programme with more funding support to help lower-to middle-income workers try out new careers.