Budget 2026 goes all-in on corporate profits, with a mega deduction that dwarfs everything else
A new 'productivity mega deduction' hands oil and gas the biggest share of the tax break, and the CCPA says it is largely money given away for spending that would have happened anyway.
Sources · CCPA Research
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The federal budget tabled November 5, 2026, puts its largest measure into a corporate tax cut called the "productivity mega deduction," which lets companies write off capital investments such as machinery. The Canadian Centre for Policy Alternatives calculates that 29 per cent of the deduction would go to oil extraction and refining and another 10 per cent to mining. The budget gives no breakdown of who receives it.
The CCPA says the deduction accounts for 14 per cent of the deficit in coming years, and that a quarter of the entire budget is devoted to it across all industries. It argues that capital write-offs of this kind mostly reward spending companies would have made anyway, so the money is given away for nothing.
The budget's smaller measures are aimed at households. A one-time 50 per cent boost to the Groceries and Essentials Benefit in early 2027 is expected to move 120,000 people just above the poverty line, according to the budget's own estimate. The Canada Workers Benefit will be slightly easier to claim with a higher base amount, and the caregiver tax credit is being made refundable, which the CCPA says will move 15,000 people above the line. A $5.4 billion child care investment, first announced in June, is also in the document.
