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April 10, 2025NEWFOUNDLAND AND LABRADOR BUDGET 2025-26 The Province of Newfoundland and Labrador released its provincial budget for 2025-26 on April 9, 2025.
Newfoundland and Labrador's 2025-26 Budget anticipates a deficit of $372 million, up from $252 million estimated for 2024-25. Newfoundland and Labrador's expenditures include a $200 million contingency to address economic impacts associated with uncertain US tariffs and retaliations. There is also a payment of $108 million to the Newfoundland and Labrador Future Fund which is intended to repay legacy debt unsupported by sinking funds.
Including federally-funded initiatives and the contingency, Newfoundland and Labrador's expenditures are projected to rise by 5.1% in 2025-26 while revenue growth is estimated to be 4.1%. Newfoundland and Labrador's revenues assume 83.9 million barrels of oil production, priced at $73 USD/barrel, generating 15% of the Province's overall revenues.
For 2026-27 and beyond, Newfoundland and Labrador projects surpluses, rising to $571 million by 2029-30. Expenditures are projected to decline in 2026-27 and 2027-28, in both federally-funded projects and regular provincial spending.
Measured as a share of GDP, the footprint of provincial government in Newfoundland and Labrador's economy amounts to 25.4% of GDP in 2025-26. This is projected to shrink to 20.6% of GDP by 2029-30.
Newfoundland and Labrador's 2025-26 deficit amounts to 0.9% of provincial GDP estimated for 2025. By 2029-30, Newfoundland and Labrador's surplus is projected to rise to 1.0% of GDP.
Newfoundland and Labrador's net debt is projected to rise to 44.8% of GDP for fiscal year 2025-26.
Newfoundland and Labrador's 2025-26 Budget expenditures amount to $20,206 per capita (including federally-funded projects). This is funded by revenues of $19,526 per capita and a deficit of $681 per capita. Expenditures per capita are projected to contract by $91 by 2029-30 while per capita revenues rise $93
Newfoundland and Labrador's revenues can be quite volatile, depending on oil market conditions. Newfoundland and Labrador's outlook for revenues is notably stronger than the forecast from the 2024-25 Budget. Newfoundland and Labrador's expenditure growth is projected to be stronger in 2025-26, delaying the previously-planned contraction by a year (though overall expenditures rise to a higher level).
Newfoundland and Labrador's projected deficit for 2025-26 is larger than previously planned. However, in subsequent fiscal years, the surplus forecast matches or exceeds prior projections.
Newfoundland and Labrador's economic outlook for 2025-26 has been substantially slowed compared with prior projections. Although exports are projected to rise on growing oil and mineral production, employment is expected to contract while household income growth slows. Nominal GDP is projected to rise by 4.3% in 2025 while real GDP grows 4.4%. For 2026, Newfoundland and Labrador's nominal GDP is projected to slow to 3.1% while real GDP growth is limited to 1.6%.
Key Measures and Initiatives
The 2025-26 Newfoundland and Labrador Budget highlights affordability, education, health care, business/industry supports and communities along with no tax or fee increases. Key measures include:
Affordability
- Seniors’ Benefit and eligibility threshold will be indexed to the consumer price index
- 50 per cent reduction on the provincial fuel tax
- 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
Education
- Add 400 educators and learning assistants in K-12 classrooms ($64 million over 2 years)
- $24 million for the continued expansion of school food programming to ($42 million per year)
- $5 million for technology devices and infrastructure in schools, rising to $10 million annually
Health Care
- $35 million for Family Care Teams.
- $26 million for integration of ambulance services
- $10 million for recruitment and retention of health care professionals
- $6 million to support addiction recovery and recovery homes
- $150 million for digital health resources
- $15.7 million for vaccines, including shingles, RSV, and pneumococcal.
- $10 million to reduce backlogs
Supporting Industry and Business
- $200 million in contingency due to uncertain economic impact of US tariffs and counter tariffs
- $15 million allocated for tourism marketing and air access
- $10 million available for a restaurant loan guarantee program
- $10 million for a new venture capital fund investing in technology companies
- $1 million to increase 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
Communities
- $42 million to construct homes
- $4 million to launch speed cameras
- Funding for new police and correctional officers.
Newfoundland and Labrador Budget 2025-26
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