Canada's budgetary deficit was higher on a year over year basis in March, and also over the April 2025 to March 2026 period, according to data released Friday from the Department of Finance.
There was a budgetary deficit of $29.7 billion in March 2026, compared to a deficit of $23.9 billion in March 2025, the department said in its latest Fiscal Monitor. The government posted a budgetary deficit of $55.3 billion for the April 2025 to March 2026 period of the 2025-26 fiscal year, compared to a deficit of $43.2 billion reported for the same period of 2024-25.
Last month, the Canadian federal government's spring economic update pointed to a lower than expected deficit and stable public finances. The federal deficit came in near $11 billion lower than expected, at around 2% of GDP and seen stable in coming years.
On today's numbers for March, the budgetary deficit before net actuarial losses and gains was $20.6 billion, compared to a deficit of $23.5 billion in the same period of 2024-25. The budgetary balance before net actuarial losses and gains is intended to supplement the traditional budgetary balance and improve the transparency of the government's financial reporting by isolating the impact of the amortization of net actuarial losses and gains arising from the revaluation of the government's pension and other employee future benefit plans.
Compared to March 2025: Revenues increased by $1.8 billion, or 4.0%, largely reflecting higher revenues from corporate income tax, interest and penalties, and the Goods and Services Tax (GST). These increases were partially offset by decreases in pollution pricing proceeds to be returned to Canadians, Employment Insurance (EI) premium revenues, and customs import duties.
Program expenses excluding net actuarial losses were down $1.2 billion, or 1.9%, largely reflecting
lower direct program expenses due to savings recognized in March 2026 from amendments to employee future benefit plans announced in Budget 2025, offset in part by a year-over-year timing difference in Canada-wide early learning and child care transfers and higher other transfer payments.
Public debt charges were up $0.1 billion, or 2%, as higher average effective interest rates on an increased stock of marketable bonds were largely offset by lower interest rates on treasury bills. Also, net actuarial losses were up $8.8 billion, from $0.3 billion to $9.1 billion, reflecting the accelerated amortization of actuarial losses following amendments to employee future benefit plans noted above, in accordance with government accounting standards.
The budgetary deficit before net actuarial losses was $41.6 billion, compared to a deficit of $39.1 billion in the April to March period of 2024-25,
Compared to 2024-25: Revenues were up $5.2 billion, or 1.1%, largely reflecting increases in personal and corporate income tax revenues, other revenues, and customs import duties due to the countermeasures imposed in response to U.S. tariffs. These increases were offset in part by lower pollution pricing proceeds to be returned to Canadians and lower GST revenues.
Program expenses excluding net actuarial losses were up $7.6 billion, or 1.6 per cent, reflecting increases in major transfers to persons, major transfers to provinces, territories and municipalities, and direct program expenses, partly offset by the wind-down of the Canada Carbon Rebate