The Big Picture
Moments ago, Finance Minister Travis Toews introduced to the Legislation the 2019 provincial budget. As widely-publicized in recent days, the budget established a four-year plan to reduce spending in order to reduce the burgeoning provincial deficit. Total government spending will be decreased by 2.8 per cent over the next four years – with health and education being spared from spending reductions.
- Revenue is expected to grow from $50 billion to $57.5 billion by 2022-23
- The provincial deficit is expected to rise to $8.7
billion (from $6.7 billion in 2018-19) before dropping dramatically and becoming a surplus in 2022-23
- Income tax brackets will no longer be indexed to inflation beginning in 2021
- The NDP Climate Leadership Plan replaced by the Technology Innovation and Emissions Reduction Program (TIER). TIER will collect $1.9 billion dollars from large emitters over the next four years.
Tax and Investment Changes
Budget 2019 enshrines in law the corporate income tax cut, which will reduce corporate taxes in Alberta to eight per cent over the next 30 months. This is the largest tax reduction for businesses in modern Canadian history. Alberta Finance officials
estimate this tax cut will increase investment by $4 billion per year by 2023.
Breaking with the approach of the previous NDP government, Budget 2019 formally eliminates five tax credits:
- The Alberta Investor Tax Credit
- Community and Economy Development Corporation Tax Credit
- Capital Investment Tax Credit
- Interactive Digital Media Tax Credit
- Scientific Research and Experimental Development Tax Credit (note: SRED tax credit will still
be available federally)
Infrastructure
- The Capital Plan calls for $24.2 billion investment over four years – a seven per cent reduction from the previous plan
- Spending on roads and bridges will rise to $792 million in 2021 before falling dramatically to $674 million
Skills and Employment
Budget 2019 announces or re-announces a number of initiatives aimed at workforce development.
- Grants for Post-Secondary institutions are being significantly reduced from $4.9 billion to $4.3 billion in 2022-23, the freeze on tuition increases is being lifted
- Supports for apprenticeship delivery are being increased by 21 per cent by 2022-23
- $11 million for CAREERS: the Next Generation to promote trades careers to high school students
- $10 million for Women Building Futures to promote trades careers to women
- $2 million for Skills Canada Alberta for young trades people to showcase their skills globally
To access the
budget documents directly, please visit the Alberta government web site by clicking here.
If you have questions or comments, please feel free to contact me directly.