Budget 2026 — Republic of Newfoundland (Overview)
A responsible, pro-growth plan that protects essential services, invests in infrastructure,
and strengthens long-term resilience. This overview summarizes the 2026 Budget as tabled on
1 November 2025. Unless otherwise noted, all amounts are in
Newfoundland Dollars (N$).
Budget at a Glance
Economic Assumptions (2026)
- Real GDP growth: 2.3%
- CPI (average): 2.5%
- Nominal GDP: N$91.6 billion
- Unemployment rate: 6.6%
Fiscal Summary
- Total revenue: N$33.7 billion
- Total expenditure (incl. interest): N$33.5 billion
- Budgetary balance: +N$0.2 billion (+0.2% of GDP)
Balance Sheet
- Net debt: N$16.4 billion
- Net debt (% of GDP): 17.9%
- Sovereign Fund (proj. end-2026): N$250.1 billion
Rules & Resilience
- Operating balance over the cycle; prudential debt limits
- SWF rule-based deposits; policy draw capped (≤3.5% of avg. MV)
- Defence allocation: ≈4.0% of GDP
Revenue Plan
Revenues reflect diversified tax bases, resource royalties, Crown earnings from hydro and energy exports,
and investment income. There are no broad-based rate increases; administrative improvements enhance
compliance and predictability.
| Category | N$ (billions) | % of Total |
|---|---|---|
| Personal income tax | 7.4 | 22.0% |
| Corporate income tax | 4.7 | 13.9% |
| Consumption taxes | 5.4 | 16.0% |
| Resource royalties & dividends | 9.1 | 27.0% |
| Hydro & energy exports (Crown) | 3.6 | 10.7% |
| Other & investment income | 3.5 | 10.4% |
| Total | 33.7 | 100% |
Selected Revenue Measures (2026)
- Targeted R&D super-deduction and accelerated CCA for clean manufacturing (time-limited).
- E-invoicing rollout to improve VAT compliance in accommodation and tours.
- Resource stabilization rule continues; windfalls above reference prices flow to the SWF.
Expenditure Plan
Program spending prioritizes health capacity, education and skills, defence at approximately 4% of GDP,
transport and energy infrastructure, fisheries science and enforcement, and digital public services—while
maintaining a modest surplus.
| Function | N$ (billions) | % of Total Expenditure |
|---|---|---|
| Health & Social Development | 6.6 | 19.7% |
| Education & Research | 4.1 | 12.2% |
| Defence & National Security | 3.7 | 11.0% |
| Transport & Infrastructure | 3.5 | 10.4% |
| Energy, Mining & Environment | 1.9 | 5.7% |
| Fisheries & Maritime Resources | 1.6 | 4.8% |
| Innovation & Digital Affairs | 1.3 | 3.9% |
| Foreign Affairs | 0.7 | 2.1% |
| Other ministries & contingencies | 6.6 | 19.7% |
| Debt service | 0.8 | 2.4% |
| Total expenditures | 33.5 | 100% |
Priority Investments (Examples)
- Defence (≈4% of GDP): long-range interceptor acquisition; expeditionary brigade stand-up;
radar and command-and-control modernization; munitions and sustainment stocks. - Health: clinical capacity, rural care incentives, telemedicine for Labrador and outports.
- Education: literacy and class-size measures; ocean engineering and Arctic medicine seats.
- Infrastructure: port modernization, Gander & Goose Bay runways, subsea cable redundancy.
- Innovation: cloud/data expansion on hydropower; critical-minerals processing; digital permitting.
Capital Plan (2026 focus & 5-Year Envelope)
The five-year capital envelope totals N$30.2 billion. The 2026 capital program (pay-as-you-go)
is budgeted at N$6.6 billion, targeting resilience, connectivity, and export capacity.
- Interceptor facilities & radar chain; runway works at Gander and Goose Bay.
- Ports and cold-chain modernization; shore-power pilots.
- Highways and bridge renewal; winter-resilience corridors.
- Hydro refurbishment & grid interties; storage pilots.
- Data corridor and subsea cables; landing station permitting.
- Public buildings and housing partnerships (energy-efficient builds; regional health hubs).
Fiscal Framework & Risk
- Operating balance over the cycle; capital financed via surpluses, SOE dividends, and prudent borrowing within ceiling.
- Sovereign Fund (SWF): rule-based deposits; policy draw capped at ≤3.5% of five-year average market value.
- Net debt: projected at 17.9% of GDP in 2026; anchor keeps it on a gently declining path.
- Stress tests: commodity price shocks and export curtailments are covered by contingencies and automatic stabilizers.