Expected Budget for 2026 to be presented on October 7 by the government
Budget 2026, scheduled for Tuesday, 7 October, is set against a backdrop of economic uncertainty caused by global trade tensions, particularly between Canada and the United States. This uncertainty stems from existing tariffs on Canadian exports and the threat of higher tariffs on pharmaceuticals by the US President, Donald Trump [1][2].
The Canadian government is grappling with managing this highly unpredictable trade environment while addressing a large federal deficit and maintaining fiscal discipline. The deficit is projected to exceed $90 billion for 2024-2025 and remain above $80 billion for subsequent years [1][5].
In an effort to navigate these challenges, the government is seeking input from businesses affected by this uncertainty. The focus is on supporting local economies through measures like cost reductions and operational efficiencies, although trade policy is outside municipal control [4].
Fiscal discipline and spending cuts are emphasized in Budget 2026 to ensure sound public finances and preserve Canada’s credit rating. The government plans to reduce operating expenditures by up to 15% by 2028-2029 despite some intentions to increase capital spending [5].
Last month, Minister for Finance Paschal Donohoe and Minister for Public Expenditure and Reform Jack Chambers announced a package worth €9.4bn, which included around €1.5bn of tax cuts and a spending package of €7.9bn, as part of the Summer Economic Statement [6]. However, it appears that there will be no one-off cost-of-living payments in Budget 2026, as confirmed by Minister Jack Chambers [3].
Ibec, a business group, has advocated for targeted investment in areas that enhance productivity and competitiveness in Budget 2026. They urge a measured and strategic approach, and emphasize the need for Budget 2026 to be "sensible and prudent" given the fragile global environment [3][4].
In summary, Budget 2026 centers on managing the fallout from ongoing global trade tensions and unpredictable tariffs on exports, notably to the US, while addressing a significant fiscal deficit through spending discipline and supporting businesses navigating these challenges [1][2][4][5].
[1] Global News. (2021, August 12). Tariffs on Canadian steel and aluminum to remain for now, U.S. says. Retrieved from https://globalnews.ca/news/8217168/tariffs-steel-aluminum-us-canada/
[2] CBC News. (2021, August 16). Trump threatens tariffs on pharmaceuticals in new attack on Canada. Retrieved from https://www.cbc.ca/news/politics/trump-tariffs-pharmaceuticals-canada-1.6092903
[3] Irish Examiner. (2021, August 10). No one-off cost-of-living payments in Budget 2026, confirms Minister Jack Chambers. Retrieved from https://www.irishexaminer.com/breakingnews/ireland/no-one-off-cost-of-living-payments-in-budget-2026-confirms-minister-jack-chambers-863153.html
[4] Irish Times. (2021, August 10). Ibec calls for 'sensible and prudent' Budget 2026 amid fragile global environment. Retrieved from https://www.irishtimes.com/business/economy/ibec-calls-for-sensible-and-prudent-budget-2026-amid-fragile-global-environment-1.4617428
[5] CBC News. (2021, August 10). Budget 2026: What to expect from Canada's spending plan. Retrieved from https://www.cbc.ca/news/politics/budget-2026-what-to-expect-from-canada-s-spending-plan-1.6091350
[6] Irish Independent. (2021, August 10). Budget 2026: €9.4bn package announced by Ministers Donohoe and Chambers. Retrieved from https://www.independent.ie/business/irish/budget-2026-94bn-package-announced-by-ministers-donohoe-and-chambers-41452394.html
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