In this video episode of Singapore Budget 2026 Insights by KPMG in Singapore, Shafiqah Binte Abdul Samat, Principal Advisor, Trade and Customs, speaks with Ajay Kumar Sanganeria, Partner and Head of Tax, on how businesses can deepen regional collaboration by navigating tariff shifts, leveraging free trade agreements, and strengthening supply chain resilience through digital platforms and targeted government support.
Read video transcript below.
Shafiqah Binte Abdul Samat:
Hi, Ajay. It is great to sit down with you today. How has it been for you?
Ajay Kumar Sanganeria:
Hi, Shafiqah. It is great to see you as well. The Singapore Budget 2026 season has kicked off. This year is particularly interesting as there are so many developments around tariffs, trade and AI.
Shafiqah Binte Abdul Samat:
There is definitely a lot of conversations about what the government has in store, especially with all the discussions and talks about tariffs.
Ajay Kumar Sanganeria:
In my view, tariffs are just one aspect. What would be interesting is how Singapore can really help businesses tap on free trade agreements, and Singapore has worked really hard to build those free trade agreements over the past years. We have quite a number – we have 15 bilateral free trade agreements, and a number of regional ones, spanning across ASEAN and Asia.
Shafiqah Binte Abdul Samat:
You are right. But these FTAs can be complex and come with significant paperwork and compliance requirements. Smaller firms may require more support to determine the country of origin of the goods.
Ajay Kumar Sanganeria:
Right. And perhaps it is time to think about a digital platform, which is government backed for free trade agreement management. It can also integrate very seamlessly with the government systems. I think that would help in terms of automating the origin calculations, better documentation management. It can also provide real-time alerts and monitoring. The result would be better supplier management, reduced costs and so on and so forth.
Shafiqah Binte Abdul Samat:
Wow, that is a great idea, Ajay. And to add on, that can be complemented by grants from the government to support that process, as well as a second targeted grant that would help local enterprises not only determine the country of origin easily, but also streamline processes and enhance IT systems for such assessment.
Ajay Kumar Sanganeria:
Indeed, and supply chain is very important and that would remove a lot of guesswork around compliance and make it easier for companies to tap on free trade agreements.
Shafiqah Binte Abdul Samat:
Ajay, could you tell me what role you think tax policies can play to help firms here go global? Very often, our clients share with us that it can be quite daunting to take that initial leap abroad.
Ajay Kumar Sanganeria:
That is right. And Shafiqah, what I have seen over so many years is that a company's global outlook is really shaped by how confident they feel back here at home. And while our tax rates are competitive, companies need further support in their journey of internationalisation, particularly as the competition is getting more intense. This is where I am talking about more of the upfront costs which companies have to incur.
They have to send people there to study the market, do the market research, or even customise their products. These costs can add up really fast.
Shafiqah Binte Abdul Samat:
I see. Maybe that is where we could also look at refining the Enterprise Financing Scheme. Under the Scheme, the Working Capital Loan is quite broad-based today, which aims at helping with day-to-day cash flow for the business. But given how regulations and supply chain are shifting, there is a case for creating a more dedicated category under the scheme to support local enterprises going through strategic transformation or those facing supply chain disruption.
Support can come in phases or stages. For example, funding could cover up to 90 percent of project costs in the first year. 75 percent in the second year and 50 percent in the third year. This approach could offer strong initial support while encouraging businesses to become more self-sufficient and especially build resilient supply chains.
Ajay Kumar Sanganeria:
Yes, indeed. And having a stronger and resilient supply chain is also very important for internationalisation. A government-backed enhanced trade platform will further enhance the trust in Singapore’s supply chain. This can be an extension of the Singapore Trade Data Exchange. The platform, by leveraging advanced technologies like AI and blockchain, can facilitate trusted payments and make it even easier to validate transactions. It would be able to offer smart recommendations on how to increase the efficiency of those transactions.
Shafiqah Binte Abdul Samat:
Indeed, such a platform could offer crucial support by lowering entry barriers to trade and helping firms manage risk early and supporting them as they adapt to global shifts.
Ajay Kumar Sanganeria:
Absolutely. There is indeed a lot of opportunities for Singapore to continue to build its status as a regional supply chain hub in the new global order.
Shafiqah Binte Abdul Samat:
I am excited to see what is in store. I really enjoyed our conversation today. Thank you for joining me, Ajay.
Ajay Kumar Sanganeria:
Thank you Shafiqah. I am really excited and I look forward to further discussions. It has been a great discussion today.
