Percentage of GDP is a somewhat vacuous measure of defense spending in any event. If you land a new job and get a 20% raise, do you automatically trade in your car for one that's 20% more expensive? Spend one-fifth more on groceries? Turn up the heat and turn down the air-con so the gas and electric bills go up?
Canada has two land borders with the same non-aggressive neighbor. Its major cities and assets are located thousands of miles from the major cities of any other nation. It is not a nuclear power. Its non-alliance, non-overeseas defense needs are thus rather minimal.