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Economic Viewpoint

Ontario Budget 2026 Preview: On the Cusp of Surplus?

March 12, 2026
Randall Bartlett
Deputy Chief Economist

Despite a tough 2025 for the Ontario economy, the province’s fiscal position has bucked the national trend by seeing a steady improvement relative to its Budget 2025 outlook. 

Much of this is because of higher revenues resulting from better‑than‑expected economic performance and projection. Upward revisions to historical GDP have also helped to reduce the level of deficits and net debt as a share of the economy. 

When the Government of Ontario releases its 2026 budget on March 26, we think it should capitalize on this tax tailwind by resisting the temptation to materially increase spending, as the federal government and some other provinces have done. Instead, it should keep some fiscal powder dry to contend with potential future shocks, such as the impending Canada‑United States‑Mexico Agreement (CUSMA) joint review.

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Ontario Budget 2026 Preview: On the Cusp of Surplus? (PDF, 1.76 MB)
NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.