Despite economic pressures from US tariffs, rising global oil prices boosted Canada’s government revenues, providing additional fiscal room as Ottawa’s November 2026 budget projects a federal deficit of CAN$62.3 billion (US$44.2 billion) for fiscal year 2026-27, the government announced Thursday.
Entitled “Masters of Our Destiny,” Canada’s 2026 federal budget proposes CAN$142.1 billion in new spending and tax measures over five years, including substantial incentives for business investment, infrastructure development and household affordability.
The projected deficit is CAN$3 billion lower than expected. However, Canada’s government has not committed to balancing the overall federal budget. Instead, it aims to balance operating expenditures by 2027–28 while continuing to run an overall deficit
Finance Minister Francois-Philippe Champagne’s 2026 budget projects federal deficits exceeding CAN$50 billion in each of the following four fiscal years.
The budget focuses on preparing Canada for future economic and geopolitical challenges, helping Canadians cope with rising living costs, and protecting the country’s economic independence, national security and sovereignty.
“The moment is serious,” Champagne said.
“Canadians know it. Our new government knows it. The moment demands an ambitious plan to be masters of our destiny,” he added, referencing the current trade war with the US.
“It is the next big step in our action plan to make this country more independent, more sovereign, master of our destiny so we can live our lives as we wish,” Prime Minister Mark Carney said as reported by CBC News.
But the official opposition party Conservatives found fault with the high cost of the budget.
“This prime minister will inflate the cost of fuel, food and homes,” said Conservative leader Pierre Poilievre. “This is a costly credit card budget that Canadians can’t afford, and Conservatives will vote ‘no’” to the budget, Poilievre said.
“This is the single biggest borrowing binge in Canadian history.”
The debt will cost about 10 cents of every tax dollar to service, CTV News reported.
Canada’s federal government debt stands at approximately CAN$1.3 trillion, reflecting years of accumulated budget deficits and borrowing.