Prime Minister Justin Trudeau has pushed back plans to balance the budget and is projecting deficits until the year 2028.
Deputy Prime Minister Chrystia Freeland unveiled the budget Tuesday, confirming prior media leaks that the government would expand dental care, offer a grocery rebate, and protect Canadians against predatory lending.
Ottawa also ditched its projection to balance the budget within five years with the next fiscal year, predicting a $40.1 billion deficit. That deficit is expected to drop to $14 billion by 2028.
In total, the Liberals have pledged a whopping $497 billion in this year’s budget, which Finance Minister Chrystia Freeland has called a “fiscally responsible” move.
Broken down further, the budget allocates $22.2 billion over five years for healthcare transfers to provinces as well as $7.3 billion for a universal dental care plan.
Freeland’s announcement also included new spending on major green programs, including $21 billion on a variety of tax credits to incentivize sustainability projects.
“In what is the most significant economic transformation since the Industrial Revolution, our friends and partners around the world – chief among them, the United States – are investing heavily to build clean economies and the net-zero industries of tomorrow,” said Freeland when presenting the budget.
“As a result, our allies are moving quickly to friendshore their economies and build their critical supply chains through democracies like our own. Together, these two great shifts represent the most significant opportunity for Canadians workers in the lifetime of anyone here today.”
Clean energy manufacturers will get a $4.5 billion tax credit over five years. The Liberals also announced a $5.6 billion credit for clean hydrogen projects.
Several tax hikes were also projected including a plan to raise $3 billion through the Alternative Minimum Tax for high earners.
On national security, the Liberal government pledged $606 million for the Canadian Armed Forces to replenish ammunition and other equipment. Another $1.4 billion will be set aside over 14 years to purchase air defense and artillery equipment.