The 2025-2026 Newfoundland And Labrador Budget

Budget Update

Siobhan Coady, Deputy Premier and Finance Minister in the Liberal government led by Premier Andrew Furey, delivered the 2025-26 budget earlier today. This budget projects a deficit of $372 million, and is expecting to return to a surplus position in next year’s budget. The deficit could rise of the province uses the $200 million contingency fund that has been set aside to respond to the threat of American tariffs.

This will be the last budget that Furey oversees as Premier; after his surprise resignation announcement earlier this year, the Liberal Party will be selecting its new leader by May 3, and the successor will become premier and lead the party into an election that is expected this year.

Highlights of the budget include:

Affordability

No new taxes, tax increases or fee increases for the fourth year.
The Seniors’ Benefit and its eligibility threshold will be indexed to the consumer price index. This builds on the 15 per cent increase over the last three years and cost $63 million. These enhancements will benefit 50,000 seniors aged 65 or older.
50 per cent reduction on the provincial fuel tax, saving 8.05 cents per litre (including HST).
50 per cent reduction off the cost of registering passenger vehicles, trucks and taxis.
Free driver medicals for people aged 75 and older.
Elimination of the 15 per cent retail sales tax on home insurance.
Maintaining the home heating supplement of up to $500 to residents who rely on furnace or stove oil to heat their home.
$78 million for the Income Supplement, which includes a 15 per cent increase over the last three years. The supplement benefits more than 150,000 families and individuals.

Education

$20 million increase to the Teaching Services budget, which will add more than 400 educators and learning assistants in K-12 classrooms. This investment will increase next year to $44 million.
$24 million for the continued expansion of school food programming to all Pre-Kindergarten and K-9 schools, bringing its budget to $42 million.
$5 million for technology devices and infrastructure in schools. This will increase to $10 million annually next year.
More than $400 million total investment in Memorial University.
$86 million for College of the North Atlantic’s operating grant, an increase of $11 million.

Health Care

Continued and increasing investment in health care and recommendations of Health Accord NL.
$35 million for Family Care Teams.
More than $26 million to continue integration of ambulance services, including $8.5 million for the expansion of helicopter emergency medevac services.
$10 million to support continued recruitment and retention of health care professionals.
More than $6 million to support addiction recovery, including a 10-bed unit in Labrador, and recovery homes.
$150 million for digital health resources, including virtual care, health IT system and MyHealthNL.
Additional $15.7 million for vaccines to protect seniors, including shingles, RSV, and pneumococcal.
More than $10 million to help reduce backlogs, such as expansion of MRI and CT services, expanded capacity for orthopedic surgery, and joint replacement services.

Supporting Industry and Business

$200 million in contingency to provide the flexibility to address economic impacts associated with the uncertainty of U.S. tariffs and associated counter tariffs.
$15 million allocated for tourism marketing and air access, including $2 million to support Vision 2026.
Up to $10 million is available for a restaurant loan guarantee program to assist locally-owned restaurants.
$10 million for a new venture capital fund to support the growth of new technology companies.
$1 million to increase wholesale pricing discounts on wine, spirits and ready to drink beverages for licensed bars and restaurants.
$800,000 to increase compensation on products sold by brewers’ agents and liquor express retailers.
$400,000 to continue the Business Navigator service to ensure businesses are connected to the correct resources to help streamline processes.
Maintaining the reduction in the small business tax rate, from 3 per cent to 2.5 per cent on income tax payable and exemption of the Health and Post- Secondary Education Tax from $1.3 million to $2 million.

Communities

$10 million to construct provincially owned homes in Western and Central Newfoundland and Labrador West.
$32 million to construct or complete over 180 homes.
Close to $4 million to launch speed cameras.
Funding for new police and correctional officers.

Fiscal and Economic Forecast

Provincial real gross domestic product (GDP) increased by 6.7 per cent in 2024, among the highest growth rates in Canada, supported by higher resource production and strong consumer spending. For 2025-26, Newfoundland and Labrador’s real GDP is forecast to increase by 4.4 per cent to $34.9 billion ($2017) in 2025, primarily due to increased oil and mineral production.

The net debt of Newfoundland and Labrador is projected to rise to $19.4 billion, up from $18.5 billion in the revised 2024-25 estimates.