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.

Just Posted

CCRD attends annual UBCM conference

Ocean Falls, health care, and transportation all brought forth

Terrace Search and Rescue headquarters gets $100K boost from Prince Rupert Port Authority

Investment to help grow regional response capacity in Northwest B.C.

Northern Sea Wolf Wednesday sailing delayed

Adverse weather will lead to a late night arrival for passengers

Molly Wickham endorses Skeena-Bulkley Valley Green candidate Mike Sawyer

In July, Wickham filed a lawsuit against CGL over the destruction of the Gidimt’en checkpoint camp

VIDEO: #MeToo leader launches new hashtag to mobilize U.S. voters

Tarana Burke hopes to prompt moderators to ask about sexual violence at next debate

Cheating husband sues mistress for gifted ring after wife learns about affair

The husband gave his mistress $1,000 to buy herself a ring in December 2017

B.C. massage therapist reprimanded, fined for exposing patients’ breasts

Registered massage therapist admits professional misconduct

B.C. boosts legal aid funding in new payment contract

‘Duty counsel’ service restored in some communities, David Eby says

Rugby Canada helps recovery efforts in Japan after typhoon cancels final match

Canadian players wanted to “give back in whatever small way they could”

UPDATED: British couple vacationing in Vancouver detained in US after crossing border

CBP claims individuals were denied travel authorization, crossing was deliberate

After losing two baby boys, B.C. parents hope to cut through the taboo of infant death

Oct. 15 is Pregnancy and Infant Loss Awareness Day in B.C.

Alberta to join B.C.’s class-action lawsuit against opioid manufacturers, distributors

B.C. government claims opioids were falsely marketed as less addictive than other pain meds

Most Read