Deficit Dropped to $941M in October
CBJ — The Federal Finance Department has announced the deficit dropped to $941 million in October compared with $3.21 billion in the same month a year ago.
Higher revenue was the main reason for the improvement, with an 11% increase in revenue coming in year over year.
Personal income tax revenues were up $1.6 billion or 16.5% from a year ago, when they were hit by a $1.6-billion downward adjustment due to the introduction of the Conservative government’s income-splitting plan for families and a doubling of the children’s fitness tax credit.The newly elected Liberal government has announced it will end income splitting for families for next year.
Corporate income tax revenues were up 4.4%, while excise taxes and duties were up 19.5%.
Meanwhile, program spending for October increased by 0.4% and public debt charges fell 6.4%.
For the April to October period, the government posted a surplus of $634 million compared with a deficit of $3.95 billion in the same period a year earlier.
Revenue for the first seven months of the fiscal year was up 8.7%, while program spending was up 6.6 per cent. Public debt charges fell 3.6%.
In April, the Conservative government projected a $2.4-billion surplus for 2015-16 — including the $1 billion set aside for contingencies.
However, oil prices have since fallen and economic growth has been far slower than estimated when the spring budget was written.
The Liberal government’s fall economic update predicted a $3-billion deficit for the current fiscal year.