Canada’s federal government in Ottawa has posted a $3.3 billion budget deficit for the first three months of its current fiscal year.
The result for the April-to-June period is larger than a $2.9 billion deficit posted for the same months in 2024.
Ottawa’s fiscal year runs from April 1 to March 31.
Revenues this year between April and June rose $3.5 billion, or 2.9%, from the previous fiscal year, largely due to increases in customs import duties related to Canada’s counter-tariffs on U.S. goods.
The federal government’s coffers also benefitted from higher corporate and personal income tax revenues.
The federal Finance Ministry says program expenses excluding net actuarial losses rose $5 billion, or 4.6%, during the three months.
Public debt charges decreased $100 million, or 0.6%, as the impact of lower interest rates on Treasury bills was largely offset by higher average interest rates charged on marketable bonds.
Ottawa’s net actuarial losses fell $900 million, or 46.8%, between April and June.
The federal government has warned of potentially widening deficits this fiscal year as it navigates U.S. tariffs and a slowing domestic economy.
The latest data showed that Canada’s economy contracted an annualized 1.6% during this year’s second quarter, raising fears of a potential recession.
