Monthly levies may range from about S$300 to S$950: Work Permit Levy Changes 2026

Singapore will update its Work Permit levy structure in 2026, affecting how much companies pay to employ foreign workers. The changes mainly impact sectors that rely heavily on migrant labour.

Businesses — particularly SMEs in construction, manufacturing, marine, and services — may need to adjust manpower planning and cost projections.

Policy Change	Key Details	Effective Date
Work Permit Levy Adjustments	Some basic-skilled worker levies increased depending on sector	2026
Simplified Levy Tiers	Selected sectors moving from three levy tiers to two	2026
Local Qualifying Salary (LQS)	Increase from S$1,600 → S$1,800	1 July 2026
S Pass Levy	Standardised at S$650 per worker per month	2026

What Is the Singapore Work Permit Levy?

The foreign worker levy is a monthly fee paid by employers for each Work Permit holder they hire.

It acts as a pricing mechanism to regulate the number of foreign workers in Singapore while encouraging companies to hire local staff or improve productivity.

The amount paid depends on several factors:

• Industry sector
• Worker skill level (higher-skilled vs basic-skilled)
• Dependency Ratio Ceiling (DRC) — the allowed proportion of foreign workers relative to local employees

Once a Work Permit is issued, employers must pay the levy every month.

Key Work Permit Levy Changes in 2026

Higher Levies for Some Basic-Skilled Workers

Certain sectors that rely heavily on lower-skilled labour will see levy increases.

Examples include:

• Marine shipyard sector: levy increase of about S$100 for basic-skilled workers
• Process sector: levy increase of about S$150 for basic-skilled workers

Higher-skilled workers in these sectors will not face levy increases, signalling a shift toward hiring more experienced workers.

Simplified Levy Structure

Some sectors are moving toward a two-tier levy system instead of three tiers.

This simplifies payroll planning for companies and reduces administrative complexity.

Typical monthly levy levels:

Worker Skill Level	Estimated Monthly Levy
Higher-skilled workers	S$300 – S$400
Basic-skilled workers	S$470 – S$600

Companies that employ a larger proportion of foreign workers will continue to pay the higher levy tier.

Overall Levy Range in 2026

Across sectors, most employers will pay between S$300 and S$950 per worker per month.

The highest levies usually apply to businesses that approach or exceed their Dependency Ratio Ceiling (DRC).

Careful workforce planning is therefore essential to control manpower costs.

Other Policy Changes Affecting Employers

Higher Local Qualifying Salary (LQS)

From 1 July 2026, the Local Qualifying Salary will rise to S$1,800.

Local employees must earn at least the LQS to be counted when calculating a company’s foreign worker quota.

If firms fail to meet this requirement:

• Their foreign worker quota may be reduced
• Some permit renewals may not be approved

Standardised S Pass Levy

Another policy change is the standardised S Pass levy of S$650 per month across all sectors.

Previously, levy levels varied depending on the sector and quota tier. The new structure provides more predictable manpower costs.

How the Changes Affect SMEs

Rising Labour Costs

Companies with a large number of foreign workers may see higher total manpower expenses.

Even small increases — such as S$100 per worker monthly — can significantly raise operating costs when applied across a large workforce.

Shift Toward Skilled Workers

Since higher-skilled workers typically attract lower levies, businesses may invest more in:

• Worker certification programmes
• Hiring experienced migrant workers
• Automation and productivity improvements

This supports Singapore’s broader workforce strategy.

More Careful Workforce Planning

Employers must closely monitor their Dependency Ratio Ceiling (DRC).

Companies that approach quota limits may move into higher levy tiers, which increases labour costs.

What Businesses Should Do Now

Employers can prepare early for the 2026 policy updates.

1. Review workforce ratios
Check foreign worker numbers against sector quota limits.

2. Budget for higher levies
Adjust payroll forecasts to account for levy increases.

3. Upgrade workforce skills
Higher-skilled workers may qualify for lower levy tiers.

4. Strengthen local hiring
Ensure local staff meet the S$1,800 LQS requirement.

5. Improve productivity
Automation and digital tools can reduce dependence on low-skilled labour.

Why This Matters

Singapore’s manpower policies aim to reduce reliance on low-skilled migrant labour while improving workforce quality.

The 2026 levy changes encourage businesses to:

• hire more skilled workers
• invest in productivity
• provide better wages for local employees

While some companies may face higher costs initially, the policy direction focuses on building a more sustainable and competitive workforce.

Frequently Asked Questions

How much is the Work Permit levy in Singapore in 2026?

Most employers will pay between S$300 and S$950 per worker monthly, depending on sector rules, skill level, and foreign worker quota usage.

When will the Local Qualifying Salary increase?

The Local Qualifying Salary will increase to S$1,800 on 1 July 2026.

Do higher-skilled workers have lower levies?

Yes. Higher-skilled workers usually fall under lower levy tiers, which encourages companies to hire or train skilled employees.

What is the S Pass levy in 2026?

The S Pass levy will be standardised at S$650 per worker per month across all sectors.