Canada Faces Growing Budget Deficit in 2023/24 Fiscal Year
Sharp Rise in Budget Deficit
Canada has reported a significant increase in its budget deficit for the first nine months of the 2023/24 fiscal year, reaching C$23.61 billion. This surge was attributed to government expenditures outpacing revenues, according to the finance ministry’s statement on Friday.
Comparative Analysis
Comparing this figure to the same period in the previous year, where the deficit stood at just C$5.54 billion, highlights the substantial growth in financial shortfall. The ministry noted that program expenses climbed by 6.6%, spanning across all major spending categories.
Factors Contributing to Deficit
The increase in public debt charges by 35.6% was mainly driven by higher interest rates. Additionally, year-to-date revenues grew by 2.6%, primarily supported by a rise in personal income tax revenue and other tax sources.
Monthly Deficit Figures
On a monthly basis, Canada recorded a deficit of C$4.47 billion in December, a notable increase from the C$1.98 billion deficit reported in December 2022.
These financial developments underscore the challenges faced by Canada in balancing its budget and managing its fiscal responsibilities amid changing economic conditions.
