The federal budget contains plenty of new spending and tax incentives that will run into the billions of dollars.

The deficit for the current budget year is being projected at $62.3 billion, which is $3-billion less than the spring estimate.  However, there is no path forward to balancing the budget. There are deficit projections of more than $50-billion annually in each of the next four years. Revenues are higher than expected, but the government will spend the money rather than apply it to the deficit.

The total bill for new tax incentives and spending is set at $142.1 billion over the next five years.

Finance Minister Francois Philippe Champagne told MP’s that the government’s operating budget will be in balance, but that does not include interest costs or other expenses.

It will take $60.2 billion to service the national debt. In comparison, the Carney government has budgeted $57.4 million this year for health care. By 2030, about 12 cents of every tax dollar will go to debt servicing charges.

The most expensive new measure over the next five years is the previously announced $36.1 billion productivity mega deduction. It is aimed at encouraging business development by allowing the write-off of new capital investments on things like equipment and buildings.

The government is also planning to spend $26.6 billion in new money for Indigenous reconciliation; an extra $4.6 billion on the grocery rebate and $11.2 billion over five years to deal with homelessness.

The Canadian Taxpayers Federation (CTF) is criticizing the Carney government for continuing to borrow billions of dollars while interest on the debt is more the $1-billion per week.  The CTF estimates the national debt will hit $1.37 trillion by the end of the year.  CTF Executive Director Franco Terrazzano said the government originally planned to spend $588-billion this year, but the budget has boosted it to $602-billion. The CTF does credit the government with an effort to simplify the tax system and provide some capital gains tax relief.