This HillStudy provides an overview of the distribution of federal government revenues and expenditures among Canada’s provinces between 2015 and 2024, based on Statistics Canada’s provincial and territorial economic accounts. It compares the revenues collected by the federal government in each province with the expenditures allocated to those provinces.
The federal government’s per capita revenues and expenditures vary from province to province, depending on the economic and demographic conditions in each province. Federal revenues come from personal and corporate income tax, the goods and services tax and social insurance contributions. Federal spending encompasses transfers to individuals (through the Canada Pension Plan and Employment Insurance, for example), transfers to provinces (through such programs as equalization and the Canada Health Transfer), as well as spending on goods and services to support government operations.
This analysis shows that federal revenues and expenditures generally increased between 2015 and 2024, with the COVID-19 pandemic producing a temporary surge in spending and widening fiscal deficits. In 2024, federal expenditures exceeded revenues nationally on a per capita basis. Alberta and British Columbia were the only provinces where federal revenues exceeded expenditures, making them net contributors. Alberta recorded the largest net contribution, reflecting its relatively high income levels, strong economic performance and resource-based economy. In contrast, the Atlantic provinces received the highest levels of federal spending per capita and recorded the lowest federal revenues per capita.
The data discussed show that net federal expenditures have a redistributive effect among the provinces. While transfer programs play a significant role in shaping provincial fiscal balances, broader structural factors – including income levels, industrial composition, demographics and population density – also strongly influence the distribution of federal revenues and expenditures across provinces.
Read the full text of the HillStudy: Distribution of Federal Revenues and Expenditures by Province
By Sirina Kerim-Dikeni, Library of Parliament
This publication is based on a previous Library of Parliament publication by Sarah Rwigema.
Categories: Economics and finance, Executive summary, Government, Parliament and politics