The Government of Canada has released its 2025 federal budget, titled “Canada Strong,” outlining a roadmap for fiscal discipline, innovation-led growth, and infrastructure expansion amid global uncertainty.
Fiscal discipline and modernization
The budget projects a $78.3 billion deficit for 2025–26, shrinking to $56.6 billion by 2029–30. A Comprehensive Expenditure Review will target $60 billion in savings over five years by cutting operational costs while preserving social programs.
Public service jobs will be reduced by 40,000 by 2028–29. A new Capital Budgeting Framework will separate capital spending from daily operations for greater transparency.
Attracting global talent
A new expedited immigration pathway for U.S. H-1B visa holders aims to draw top tech talent.
- $1.7 billion over 13 years will fund 1,000+ international researchers.
- $97 million supports a Foreign Credential Recognition Action Fund.
Temporary resident levels will be adjusted, while permanent resident intake remains around 380,000 annually.
Business and tax measures
No changes to personal or corporate tax rates. Key highlights include:
- Immediate full expensing for manufacturing and processing buildings after Nov. 4, 2025.
- Updated transfer pricing and trust anti-avoidance rules.
- Underused Housing Tax and luxury tax on aircraft and vessels repealed by year-end.
Innovation and life sciences
A new Federal Life Sciences Strategy gets over $1 billion for research, innovation, and infrastructure.
Enhanced SR&ED and clean tech incentives form part of a $110 billion five-year plan to boost productivity and competitiveness.
Digital economy and stablecoins
New legislation will regulate fiat-backed stablecoins under the Bank of Canada, aligning with international digital finance standards.
Housing and infrastructure
To address housing shortages, the budget pledges $25 billion over five years for new supply and exempts first-time buyers from GST on homes up to $1 million.
The new Build Canada Homes agency will fast-track projects, while major investments target transport, clean energy grids, and digital connectivity.
Supporting Canadians
Key social priorities include:
- Continued funding for child care, pharmacare, and disability benefits
- $4.4 billion toward veterans’ and RCMP medical cannabis programs
- Expanded youth training and employment programs
Toward sustainable prosperity
Prime Minister Mark Carney’s government aims to mobilize $500 billion in private investment by 2030, positioning Canada as a leading G7 economy.
The 2025 budget marks a generational pivot toward strategic nation-building, balancing fiscal restraint with bold investments in innovation, infrastructure, and people.
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