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Ottawa still managed to lower its debt-to-GDP to 31.3 per cent, down from 32 per cent in 2016-17, when adjusted for the new accounting system. But that ratio now stands well above the 30.4 per cent that was projected in the 2018 budget, under the old accounting rules.

Ottawa also added around $20 billion to the national debt in the 2017-18 fiscal year. As of March 31, Canada’s net debt now stands at $758 billion, up from $734 billion in 2016-17.

The higher spending came as personal income tax revenues increased over the year, and amid a strong Canadian economy. Bank analysts and other experts have said Ottawa should instead lower its spending amid a tight labour market and robust economy, keeping more cash in hand should the global economy flounder.

Ottawa added around $20 billion to the national debt

Prime Minister Justin Trudeau had initially promised to return to surplus in the years following his election win, after running an initial deficit of $10 billion. The deficit is now just under $20 billion, with Ottawa abandoning its plan to balance the books before the election.

Canada’s net debt-to-GDP ratio still remains among the lowest and healthiest of any developed nation. In the U.K., for example, the ratio is around 70 per cent.

Personal income tax revenues grew by $9.9 billion, or 6.9 per cent, a rise that came in part due to controversial tax changes introduced by the Liberal government last summer.

The annual deficit came in at $19 billion, virtually unchanged from the year prior

The changes included a higher tax rate on “passive” investment holdings above a certain threshold. That prompted many high-wealth individuals to defer their earnings and skirt the higher rates in 2016-17, blowing a hole in government revenues last year.

However, Finance officials said the rise in personal income tax revenues suggested Ottawa has now recouped some of this initial losses.

The annual deficit came in at $19 billion, virtually unchanged from the year prior.