In his Budget speech on Tuesday (Feb 14), Finance Minister Lawrence Wong announced that the Central Provident Fund (CPF) monthly salary ceiling will be raised in four steps from S$6,000 to S$8,000 by 2026, in order to keep pace with rising salaries. The CPF monthly salary ceiling sets the maximum amount of CPF contributions payable for ordinary wages, and was last updated in 2016. However, there will be no changes to the CPF annual salary ceiling, which includes contributions from additional wages.

For senior workers aged between 55 and 70, the total CPF contribution rates will be raised by up to 1.5 percentage points from Jan 1, 2024, as part of the government’s plan to increase senior worker CPF contribution rates over the next decade. The first two steps of increases took effect in Jan 2022 and Jan 2023. To assist employers in managing the costs associated with the increase, a one-year CPF Transition Offset will be provided.