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April 11, 2025PRINCE EDWARD ISLAND BUDGET 2025-26 The Province of Prince Edward Island released its provincial budget for 2025-26 on April 10, 2025.
Prince Edward Island's provincial deficit is estimated at $183.9 million for 2025-26, up from the $166.3 million forecast for 2024-25. Deficits are projected to continue in each of the subsequent two fiscal years.
Prince Edward Island's revenues are projected to rise by 7.1% in 2025-26 while expenditures grow by 7.2%.
Measured as a share of GDP, the footprint of provincial government in Prince Edward Island's economy amounts to 32.3% of GDP in 2025-26. This is projected to shrink slightly to 32.1% of GDP by 2027-28.
Prince Edward Island's deficit for 2025-26 amounts to 1.7% of 2025 nominal GDP. The deficit is projected to narrow to 1.0% of GDP by 2027-28.
Prince Edward Island's net debt to GDP ratio is estimated at 32.6% for 2025-26, up from 29.0% in 2024-25. It is projected to rise to 35.0% in 2026-27 and to 35.9% in 2027-28.
Prince Edward Island's 2025-26 Budget expenditures amount to $19,540 per capita, funded by revenues of $18,521 per capita and a deficit of $1,019 per capita. Expenditures per capita are projected to rise by $1,150 by 2027-28 while per capita revenues rise $1,517.
Prince Edward Island's revenue outlook is little changed from the projections in the 2024-25 Budget. However, the outlook for expenditures has been revised up since last year's fiscal plan.
With similar revenues and rising expenditures, Prince Edward Island's deficit outlook has deteriorated compared to the 2024-25 projection.
The Prince Edward Island has benefitted from rapid growth in recent years attributable to rising population. However, the Provincial government has reduced nominations through its immigration streams and lowered its outlook for population growth in the next 4 years. This is expected to have knock-on effects on employment, labour income and consumer spending, though pent-up demand is expected to drive construction activity. Prince Edward Island's real GDP is projected to grow by 2.5% in 2025 (4.3% in nominal terms), followed by a 2.0% real GDP gain in 2026 (4.0% in nominal terms).
Key Measures and Initiatives
Prince Edward Island's 2025-26 Budget prioritizes security for the economy, health care, communities, infrastructure and education. Key measures include:
Economy and workforce
- Raising the small business threshold to $600,000 and lowering the corporate income tax rate by 1%
- $3 million contingency fund and a Genome Surveillance Project to support the oyster industry
- Establishing a $32 million Tariff and Trade Contingency Fund as well as a $10 million Tariff Working Capital Program
- Increasing the basic personal amount for the personal income tax to $14,650 for 2025, followed by an increased to $15,000 in 2026 along with a 1.8% increase in tax bracket thresholds (1 year earlier than originally planned)
- Increasing minimum wage to $17/hour
- Increasing student bursaries
Heath care
- New programming to certify up to 40 internationally trained physicians annually
- Creating a 29-week Accelerated Medical Administrative Support Program
- Expanding the Student Nursing Employment Program
- Launching a pathway for LPNs to train and become registered nurses while working
- Supporting the UPEI Faculty of Medicine for the first cohort of medical students
- New and expanding Patient Medical Homes
- Expanding teams and hours in Primary Care Access Clinics
- Expanding medical transportation assistance
- Increasing per diem rates for private long-term care homes
- Funding to ready 103 new long-term care beds, with plans to add an additional 175 new long-term beds in the future.
- $4.8 Million for health care access care through phone, video, or text
- Making the seniors' Self-Managed Care program permanent and expanding the At Home Caregiver Benefit program
Communities and Infrastructure
- Creating a Joint Enforcement Team combatting mid-level drug trafficking and organized criminal networks
- Increasing the Home Heating Assistance Program
- Creating a Municipal Infrastructure Bank Program with low-interest loans for infrastructure
- Increasing funding to food banks
Education
- Helping child care centres stabilize before and after school programming
- Expanding the School Food Lunch Program
- New funding for staffing, teacher prep time and front-line school staff
- Providing a $200 Back to School and $200 Change in Season benefit for children in group homes, foster care, as well as those supported through the Grandparent and Alternate Care Program
Prince Edward Island Budget 2025-26
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