Fiscal Federalism in Canada

Abstract

The purpose of this report is to explain the major dynamics affecting fiscal federalism in Canada. It is written primarily for an audience that does not have an extensive knowledge of Canada but it does make use of terms and concepts that are common in the study of fiscal federalism. The major figures in Canadian fiscal federalism are the federal and provincial governments. Territorial governments, local governments and the newly emerging models of aboriginal self-government are significant figures in fiscal relations in Canada, and they receive some attention in the report, but the main focus of this analysis is on the relationship between the federal government and the provinces. The content of the report combines material from the study of economics and political science to provide both a quantitative and qualitative analysis of fiscal federalism in Canada. The report focuses on explaining the current relationship between governments but in doing so a significant amount of attention is given to explaining the historical developments that have led to the current situation.