Some key highlights from the Liberal government’s 2025 federal budget

OTTAWA – Finance Minister François-Philippe Champagne introduced the 2025 federal budget on Tuesday. Here are some key highlights from the first federal budget under Prime Minister Mark Carney:

AI and quantum computing

The budget allots $334.3 million to strengthen Canada’s quantum ecosystem. The money will be provided through the Defence Industrial Strategy over a five-year time period.

The emerging technology uses the principles of quantum mechanics for applications like computing.

The budget also sets aside money to build large-scale sovereign public AI infrastructure.

Indigenous cutbacks

The Carney government is freezing its annual base funding for Indigenous health and social services, saying this amounts to a two per cent cut for the Indigenous Services department. The government tasked most government departments to come up with a 15 per cent cut.

Crown-Indigenous Relations and Northern Affairs also took a two per cent cut. The budget warns that its liabilities have ballooned over the past decade due to Indigenous claims and litigation settlements, and says it is hard to estimate liabilities for “this important priority.”

The budget, which did not include a full chapter on Indigenous issues, says Indigenous communities should benefit from defence investments and trade infrastructure through an Arctic development fund.

Carney’s government is also sticking with its current commitments to housing investments for Indigenous communities, but will review its nutrition subsidies and health care programming in the territories.

Ending the luxury tax on planes, boats

The budget is putting an end to the luxury tax on planes and boats introduced by the Trudeau government. The document says the move will “provide relief to the aviation and boating industries and increase the overall efficiency of the luxury tax framework.”

Ending the tree-planting program

The government plans to wind down the program to plant two billion trees introduced under former prime minister Justin Trudeau. 

The document says the program has committed to planting nearly a billion trees. It notes uncommitted funds will be returned.

Veterans’ services

The budget allocates $184.9 million over four years to improve disability benefits services for veterans. The money will go to Veterans Affairs Canada to improve processing capacity for applications and modernize processes and IT infrastructure.

The government will lower how much it reimburses veterans through its medical cannabis program. It says the current rate of $8.50 per gram is significantly above market price and it will lower the reimbursement to $6.00 per gram.

Not a feminist budget

The budget does not use the word “feminist” at any point and there is no mention to the Feminist International Assistance Policy pioneered by Trudeau.

But the document did include the gender-based analysis that the last government introduced, which assesses how various demographic groups are affected by various policies.

This report by The Canadian Press was first published Nov. 4, 2025.