Alberta’s corporate tax rate has dropped to eight per cent, making it by far the lowest rate in Canada and among the most competitive in North America.
By fully implementing the Job Creation Tax Cut a year and a half ahead of schedule, government is sending a strong message that we are open for business. Alberta’s general corporate income tax rate is now at least 30 per cent lower than any other provincial rate.
Accelerating the tax cut provides Alberta businesses with confidence and certainty as they recover from the COVID-19 pandemic, freeing up resources to hire Albertans. It also makes Alberta an attractive location for companies outside the province to relocate and take advantage of the province’s competitive tax rate.
“As Alberta moves towards recovery, we remain committed to making our province one of the most tax-competitive jurisdictions in North America and the top business destination in the country. The Job Creation Tax Cut will dovetail with the new Innovation Employment Grant to support a wide range of Alberta job creators.”Travis Toews, President of Treasury Board and Minister of Finance
Corporate tax cut and new incentive promote economic diversification
The Innovation Employment Grant, recently announced as part of Alberta’s Recovery Plan, will complement the Job Creation Tax Cut by targeting small and medium-sized companies in the early stages of operation. Combined, these programs will reward innovation, diversification and investment by businesses of all sizes in all sectors of the economy.
Both measures support the development of new products and ideas, but a low general corporate tax rate also provides a strong incentive to commercialize those products here in Alberta, instead of other jurisdictions.
A low general corporate tax rate also encourages diversification, as it provides more benefit to companies outside the resource sector and adds extra incentive to invest and grow in Alberta. This includes both smaller and larger firms, as government estimates that 75 per cent of the businesses benefiting from the Job Creation Tax Cut file taxes as small businesses.
More information about the Innovation Employment Grant will be available soon.
Alberta’s government is helping create thousands of good jobs for Albertans by building schools, roads and other core infrastructure that benefits Albertans and communities. It will further diversify our economy by helping sectors grow and succeed and returns investment to our province by ensuring we have the most competitive tax environment in Canada.