The province had tabled a CAD 244 billion spending plan, but it now reflects a deficit until 2028-’29.
The spectre of global instability looms largely in Ontario’s ’26 budget. It reflects a tax cut for small businesses alongside a reprieve on HST for new home buyers. It also delays a balanced budget for yet another year with a higher-than-forecast deficit.
The CAD 244 billion spending plan is replete with phrases like ‘uncertainty’ & ‘heightened trade tensions’. It includes an increase in reserve spending from CAD 1.5 billion in ’’26–’27 to CAD 2.5 billion in ’’28–’29.
The last year has been marked by ‘significant change in the world around us’, shared Finance Minister Peter Bethlenfalvy whilst unveiling the budget at Queen’s Park on Thursday afternoon, 26 March.
He added that geopolitical forces that may have once felt distant may have by now reached Canadian shores. Global economic and trade tensions, supply chain disruptions, and shifting markets are significant challenges we face. If simply expressed, the world has changed, so we may need to change with it.
Last year, the province projected a balanced budget for 2027 – ’28. However, officials now project a deficit of CAD 13.8 billion next year, reducing it to CAD 6.1 billion the year after. It also reflects the possibility of a small surplus generated in 2028 – ’29.
That nearly CAD 14 billion deficit is a significant surge from the CAD 7.8 billion deficit the 2025 budget eyed for this upcoming year as Ontario bets big on infrastructure. Also, on research and innovation funds, high-growth industries & cutting costs for small businesses.
Bethlenfalvy told reporters before his speech that he would prefer to have a smaller deficit. He added that he would prefer a balance sooner, although they may have to live in the world we are in. As such, he opined that they may now have challenges ahead of them.
