Singapore Allows Firms to Carry Forward Unused Carbon Credit Quotas

Singapore announced on May 11, 2026, that companies liable for carbon tax will be allowed to carry forward unused International Carbon Credit (ICC) offset quotas from emissions year 2025 into 2026. The decision was jointly announced by the Ministry of Sustainability and the Environment (MSE) and the National Environment Agency (NEA) as part of efforts to support businesses amid limited availability of eligible carbon credits. Under Singapore’s ICC Framework, carbon tax-liable companies are permitted to offset up to 5% of their taxable emissions using high-quality international carbon credits aligned with Article 6 of the Paris Agreement. Authorities said the rollover is intended as a transitional measure to give international carbon markets more time to mature and increase the supply of eligible credits. The government also confirmed that a credit conversion formula will be applied to adjust the value of offsets carried over into 2026, following the increase in Singapore’s carbon tax rate to S$45 per tonne for emissions year 2026. However, unused quotas already rolled over from 2024 to 2025 will expire and cannot be extended further. Singapore has been actively expanding international carbon market cooperation through implementation agreements with multiple countries, including the Philippines and Thailand. Officials stated that these partnerships are expected to generate more eligible credits over time while supporting global climate mitigation efforts and the development of high-integrity carbon markets.