Quebec economic update: Modest financial relief to households, lower deficit

Quebec’s finance minister is looking to give taxpayers a little breathing room in an economic update that includes a reduction to the contribution rate for social security programs.

Eric Girard’s update Tuesday also includes modest decreases to payroll deductions for the provincial pension plan and parental insurance.

These reductions, along with adjustments to how personal income taxes and social insurance benefits are indexed, are expected to represent an average gain of $182 per taxpayer in the 2026-27 fiscal year.

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Quebec is also following in the footsteps of the federal government and cancelling the increase in the capital gains inclusion rate, which would have raised the rate to 67 per cent from 50 per cent.

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The deficit, meanwhile, is projected to be $12.4 billion this fiscal year, down from the $13.6 billion announced in the last budget.

Real GDP, adjusted for inflation, is expected to rise by 0.9 per cent in 2025 and 1.1 per cent in 2026.

Girard says the economy is showing encouraging signs, and the government is on track to return to a balanced budget by 2029-30.

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