Hundreds of cellphones were raised in the air Saturday, Dec. 2, 2017, as supporters tried to capture a picture of Prime Minister Justin Trudeau as he made his rounds at Semiahmoo Secondary. (Aaron Hinks photo)

PBO sets budget baseline for campaign vows with tools, deficit projections

Parliament’s spending watchdog estimates that federal books will be in the red by $20.7 billion this year

Parliament’s spending watchdog is predicting years of deficits deeper than the government has laid out.

The numbers are in a report the parliamentary budget office says should set the baseline for the campaign promises parties will dangle in front of voters this fall.

WATCH: Five highlights in the 2019 federal budget

The PBO estimates that federal books will be in the red by $20.7 billion this year and bottom out at a deficit of $23.3 billion the year after, before improving to a $12.5-billion deficit by 2022.

The numbers are better than the PBO predicted in April but worse than the figures in Finance Minister Bill Morneau’s pre-election budget that forecast deficits between $19.8 billion and $12.1 billion.

The estimates and a new online costing tool are part of PBO efforts to prepare for its role as an independent auditor of each party’s spending plans in the upcoming election campaign. The watchdog office plans to post cost estimates of campaign promises as the parties announce them before and during the campaign.

The report is likely to make it more difficult for any party to cook its own projections and also makes it difficult for any party to promise a quick return to balanced budgets.

Still, the PBO offers one possibility for making up some of the shortfall in a separate report detailing how much the government loses to tax evasion, to overseas tax havens, and through tax avoidance through legal loopholes that contravene the spirit of income-tax laws.

The difference between what is collected and what could be collected absent tax-evasion schemes is known as the “tax gap.”

The Canada Revenue Agency, in a report earlier in the week, pegged the lost take in federal corporate income taxes in 2014 at between $9.4 billion and $11.4 billion. But by looking at electronic transfers into and out of Canada, as well as special tax filings, the budget office gives a “hypothetical” estimate that $25 billion might have been lost in corporate tax revenue.

What the PBO was more certain of is that money flowing between Canada and countries known to be tax havens was “disproportionately large.”

“One thing is clear — we need greater transparency on corporate finances and financial flows, including who owns what companies,” said Toby Sanger, executive director of Canadians for Tax Fairness, in a statement.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Comments are closed

Just Posted

Gabriola skatepark project gets $567,000 infrastructure grant

Federal and provincial governments providing money for Huxley Park amenities

B.C. Supreme Court dismisses claim against Island Corridor Foundation

Snaw-Naw-As (Nanoose) First Nation was seeking return of reserve land as railway sits unused

LETTER TO THE EDITOR: Council’s special-interest projects boosting property taxes too high

City council should keep in mind its core services when budgeting, says letter writer

Colour and culture being painted onto plaza stairs in downtown Nanaimo

City commissions Humanity in Art muralists for ‘artistic intervention’ project

Nanaimo’s newest skatepark now open for use in Harewood

Harewood Centennial Park amenity opens on schedule

‘Mind boggling’: B.C. man $1 million richer after winning Lotto 6/49 a second time

David O’Brien hopes to use his winnings to travel and of course keep playing the lottery

White-throated sparrows have changed their tune, B.C. study unveils

Study marks an unprecedented development scientists say has caused them to sit up and take note

B.C. teacher loses licence after sexual relationships with two recently-graduated students

The teacher won’t be allowed to apply for a teaching certificate until 2035

Lower Mainland teacher facing child pornography charges

Elazar Reshef, 52, has worked in the Delta School District

Man who rammed gate near Trudeau residence with truck faces multiple charges

The man, who police have not yet officially identified, will be charged with multiple offences

All community COVID-19 outbreaks declared over in B.C.

Abbotsford manufacturer cleared by Dr. Bonnie Henry

Kelowna RCMP commander calls for more nurses during wellness checks after complaint

Southeast District Commander wants to increase Police and Crisis Team program

‘Tarantula moth’ spotted in broad daylight on Vancouver Island

Polyphemus moths are one of the largest insects in B.C.

Most Read