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Liberal leader Justin Trudeau at the University of Toronto on Sept. 29, 2019 in Mississauga, Ont.Ryan Remiorz/The Canadian Press

The Liberals are promising billions in new spending and tax cuts if re-elected, with a campaign plan that would increase the deficit to $27.4-billion next year and run up large deficits for three more.

The party, which released its full campaign platform Sunday, three weeks before the Oct. 21 election, says a mix of tax hikes on business and high-income Canadians and an internal-spending review would pay for many of those promises.

However, there is uncertainty that these would generate the level of revenue that the Liberals are projecting.

The party says that its plan is responsible, would boost the economy and continue to reduce the country’s debt-to-GDP ratio, one barometer of fiscal health. The $27-billion deficit in the first full year of a new Liberal mandate would be about $4-billion higher than the most recent baseline projection produced by the Parliamentary Budget Office (PBO).

As part of the platform, the Liberals unveiled independent costing reports prepared by the PBO for the platform’s major planks, although not all elements of the party agenda were reviewed by the PBO. One of the Liberals’ largest campaign pledges − a plan to negotiate a national pharmacare system with the provinces – is not fully costed in the platform. Further, the PBO noted that some Liberal estimates of how much money could be raised through various tax hikes – such as the 10-per-cent-tax on luxury goods − are highly uncertain.

The party’s clear acceptance of deficit spending throughout a second mandate marks a departure from its 2015 platform, when it promised that deficits would be temporary and that the budget would return to balance in 2019.

Opinion: Deficit plans take backseat as federal parties seek to spend more

The release of the Liberal platform includes new measures to fight gang violence and promises to expand postsecondary student grants in addition to billions in previously promised measures. It also unveiled plans for tax increases aimed at large corporations such as Facebook and Google, as well as tax hikes for high-income Canadians, such as a proposed new tax on luxury purchases such as boats, cars and personal planes worth more than $100,000.

Liberal Leader Justin Trudeau said the Liberal plan is fiscally responsible and presents a clear choice for voters who reject the cost-cutting message of Canadian conservatives.

“We are going to continue to demonstrate the wisdom of investing in people as a way of growing the economy,” Mr. Trudeau said Sunday in Mississauga. “As a contrast with Conservatives, who just want to cut to balance the budget at all costs.”

The main revelation in the platform is how the party’s campaign pledges would affect Ottawa’s bottom line.

While last year’s federal deficit came in at $14-billion, the PBO said in June that the deficit was on track to climb to $20.7-billion this year and reach a high of $23.3-billion in the fiscal year that starts April 1, 2020.

Using the PBO baseline as a starting point, Sunday’s platform says the deficit for that year would be $27.4-billion after accounting for campaign pledges. The platform then projects deficits of $23.7-billion, $21.8-billion and $21-billion for the three remaining years of a four-year mandate.

By comparison, Conservative Leader Andrew Scheer has promised to balance the budget in five years, but he has not yet released a complete platform showing how that would be accomplished.

Even though the deficits proposed by the Liberals would add about $94-billion to the federal debt over four years, the size of the federal debt as a percentage of GDP would decline slightly from 30.9 per cent to 30.2 per cent over those four years.

The Liberals are promoting their platform as an antidote to cost-cutting conservative premiers, such as Ontario’s Doug Ford. Speaking in Mississauga, Mr. Trudeau attacked Mr. Ford’s policies, including changes to Ontario’s prescription-drug program and increasing class sizes.

In response to questions about his party’s projected deficits, Mr. Trudeau said the debt-to-GDP ratio is a reliable measure of Ottawa’s fiscal health.

“I think reducing the size of our debt as a proportion of our GDP every year is the responsible thing to do,” he said.

The party’s decision to abandon its past focus on balancing the books has been criticized by party veterans, such as former Liberal finance minister John Manley, who argue that balanced-budget targets encourage fiscal discipline. However, some economists counter that federal deficits are no longer the public-policy concern that they once were owing to Canada’s comparatively low debt-to-GDP ratio and the fact that long-term interest rates are near historic lows.

“There isn’t really any kind of economic argument that [the deficit] has to be zero or near zero,” said Mostafa Askari, chief economist at the University of Ottawa’s Institute of Fiscal Studies and Democracy, which is headed by former parliamentary budget officer Kevin Page. The institute released a report Sunday that gave a generally positive assessment of the Liberal platform in terms of the credibility of its financial assumptions.

“We think overall it’s a good platform,” Mr. Askari said. “It’s essentially stay the course.”

Conservative and NDP critics disagreed, pointing out that it does not fully account for large Liberal campaign promises, such as negotiating a national pharmacare plan.

“There will be a massive sticker shock to Canadians if they re-elect Trudeau as taxes will go through the roof to pay for these unaffordable – and in some cases – uncosted promises,” Conservative candidate Pierre Poilievre said.

NDP Leader Jagmeet Singh said his party will act immediately on pharmacare and that the Liberal Party cannot be trusted to deliver on its promises.

“With this platform, what Mr. Trudeau has done is turn his back on families,” he said Sunday in Surrey, B.C. “He’s turned his back on families who need pharmacare, those who need help with housing. He’s turned his back on students. On pharmacare, he’s clearly walked away from universal pharmacare.”

Over four years, the Liberal platform makes $56.9-billion in new promises and plans to raise $25.4-billion through various tax increases and spending reductions. The combined projected deficit over the four years is $31.5-billion higher than the baseline deficit projections released by the PBO in June.

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