Federal Minister of Finance, Bill Morneau, presented his budget on March 22, 2017. The government is continuing with its planned focus on the middle class through innovation, skills, partnership and fairness.
As widely anticipated, the budget projects significant deficits over the next several years. The government forecasts a deficit of $23 billion for 2016–17 and $28.5 billion in 2017–18. Over the next four years, deficits are expected to decline gradually from $27.4 billion in 2018–19 to $18.8 billion in 2021–22.
Canada continues to have the lowest total government net debt-to-GDP ratio of all G7 countries. The federal debt-to-GDP ratio is projected to decline gradually after 2018–19 reaching 30.9 percent in 2021–22.
Investing in priorities
The government will initiate three new expenditure management initiatives:
- A comprehensive review of at least three federal departments (to be determined), with the aim to eliminate poorly targeted and inefficient programs, wasteful spending and inefficient programs, and ineffective and obsolete government initiatives.
- Initiate a three-year review of federal fixed assets to identify ways to enhance or generate greater value from government assets.
- Initiate a review of all federal innovation and clean technology programs across all departments, as federal programs are dispersed to simplify programming and better align resources to improve the effectiveness of innovation programs.
The government will report on the progress of these reviews in Budget 2018. The government will also introduce legislative changes to improve the organization and efficiency of government operations, as needed.
Previously announced tax measures
The government confirmed its intention to proceed with the following previously announced tax and related measures:
- Improve fairness to the capital gains exemption on the sale of a principal residence (announced on October 3, 2016);
- Information-reporting requirements for certain dispositions of an interest in a life insurance policy (announced in Budget2016);
- Legislative proposals released on September 16, 2016, relating to income tax technical amendments;
- Legislative and regulatory proposals released on July 22, 2016 relating to the Goods and Services Tax/Harmonized Sales Tax (GST/HST) and
- Measures confirmed in Budget 2016 relating to the GST/HST joint venture election.