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Canada’s Liberals Promise to Spend Billions of Tax Dollars to Lure Voters

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Canadian Prime Minister Justin Trudeau’s Liberal Party is promising to spend billions of tax dollars on initiatives if re-elected next month. However those commitments would require a deficit of more than C$20 billion over the next four years.

Trudeau, who is waging a tough battle for re-election, released the Liberals’ fully costed platform yesterday. He promised tax money for families, students and the environment. Canadians vote on Oct. 21.

If re-elected, the Liberals said they would spend C$9.3 billion in 2020-21, rising to nearly C$17 billion by year four.

The federal deficit would be $27.4 billion in the first year of a second term. Before declining slightly to C$21 billion in 2023-24.

When elected in 2015 Trudeau’s Liberals promised to run three years of deficits before returning the federal budget. Sunday’s platform made no mention of when he would balance the budget.

Tax revenues were estimated at C$5.2 billion in the first year, rising to C$7.2 billion in 2023-24. Thanks partly to the Liberals promise to crack down on corporate tax loopholes. And of course implement a 10% tax on luxury cars, boats.

Canada’s debt-to-GDP ratio would remain around the 30% mark, beginning at 30.9% in 2020-21 before dropping slightly to 30.2% in year four.

Trudeau and his Liberals Believe Budgets Balance Themselves?

In other words, Trudeau’s campaign platform hikes his combined projected deficits over the next four years by almost $37 billion, compared to what he said in March.

Finally, in his 2015 campaign platform, Trudeau said Canada’s debt-to-GDP ratio, an important indicator of the government’s economic health, would be 27% this year. His March budget put it at 30.7%. His platform released Sunday says it will still be 30.2%, four years from now.

Trudeau’s campaign platform can accurately be described as the work of a prime minister who actually believes budgets balance themselves.

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