When the new government said last year that it would return Canada to deficits, few expected the numbers to jump to nearly $30 billion this year and next and add $100 billion in debt over the next five years. But lower than expected revenues have forced the government’s hand, according to Finance Minister Bill Morneau, requiring increased spending to stimulate the sluggish economy and support the middle class.
Despite failing to make good on “key election promises relating to fiscal management,” there are enough positive indicators in the budget that CPA Canada is taking a wait-and-see approach, calling it a “down payment on a long-term fiscal plan that charts a course to strengthen the Canadian economy.” Among the positive signs are efforts to close tax loopholes, reduce tax evasion and increase tax compliance.
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