Budget gap narrows again in October

Fri Dec 23, 2011 11:03am EST
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OTTAWA (Reuters) - Higher tax revenues helped Canada cut its budget deficit in the first seven months of the 2011-12 fiscal year to C$15.39 billion ($15.09 billion) from C$21.54 billion in the same period the previous year, Ottawa said on Friday.

In October, an 8.1 percent jump in revenues meant the deficit fell to C$2.16 billion from C$4.11 billion in October 2010, the finance ministry said in a statement. Program expenses were down by 3.2 percent.

Revenues in the first seven months of the year were up 5.7 percent, primarily reflecting higher income tax revenues. Program expenses were down by 0.8 percent.

The Conservative government says it will not be able to eliminate the budget deficit by 2014-15 as initially promised, and has pushed back the date for balancing the books by one year to 2015-16.

Ottawa now predicts the 2011-12 deficit will be C$31 billion.

($1 = $1.02 Canadian)

(Reporting by David Ljunggren; Editing by Jeffrey Hodgson)