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flag Canada's deficit rose to $26.1B in 2025-26 due to higher spending, despite increased revenue and lower debt costs.

flag Canada's federal government reported a budget deficit of $26.1 billion for the April-to-December 2025-26 period, up from $21.7 billion the previous year. flag Revenue increased to $363.4 billion, fueled by higher customs duties from trade measures against U.S. tariffs and stronger income tax collections. flag Program spending rose to $344.9 billion, driven by higher transfers and direct spending. flag Debt charges fell slightly to $40.9 billion due to lower interest rates and reduced swap costs, while net actuarial losses climbed to $3.7 billion.

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