Canada’s Budget Deficit Grows to $25. 5 Billion in Early 2026

Canada’s government now reports a larger shortfall for the first eleven months of the 2025/26 fiscal year, with expenses outpacing income by C$25. 55 billion – an increase from the C$19. 27 billion recorded in the same span last year. The rise comes mainly from a 2. 1 percent jump in program spending, which affected nearly every major budget line. Debt servicing costs fell slightly by 0. 1 percent, thanks to lower interest rates on treasury bills; however, higher average rates on newly issued marketable bonds partially counterbalanced that gain.Revenue growth of 0. 8 percent was driven largely by higher customs duties and stronger corporate and personal income tax collections. On a month‑to‑month basis, Canada turned a C$5. 66 billion surplus in February this year, down from the C$7. 57 billion surplus seen in February 2025. These figures illustrate how shifting economic conditions can quickly alter a nation’s fiscal balance, prompting policymakers to adjust spending and tax strategies accordingly.