AB Budget 2024 introduces a new personal tax bracket for income up to $60,000 starting in 2026 as well as several new sales and excise taxes on electric vehicles, fuel, tobacco products, and more.
AB Budget 2024 estimates that the province’s surplus for the 2023-24 fiscal year (ending March 31) will be $5.2 billion, compared to the $2.4 billion surplus projected in the previous budget. The increase in the surplus is primarily due to rising energy prices.
Fiscal projections for the next three years are as follows:
| Year |
Projected surplus/(deficit) |
| 2024–25 |
$0.4 billion |
| 2025-26 |
$1.4 billion |
| 2026-27 |
$2.6 billion |
Business tax measures
Corporate tax rates
AB Budget 2024 makes no changes to the corporate tax rates or the $500,000 small business limit.
2024 combined federal and Alberta corporate tax rates
| Year |
Small business tax rate |
General corporate tax rate |
Manufacturing and processing tax rate |
| 2024 |
11.00% |
23.00% |
23.00% |
Personal tax measures
Personal tax rates
AB Budget 2024 introduces a new personal tax bracket for income up to $60,000 starting in 2026. The tax rate for this new bracket will be 9% for 2026 and will reduce to 8% in 2027. However, this timeline is contingent on whether Alberta can maintain a balanced budget while providing this tax cut.
No additional personal tax rate changes were announced. The indexed personal tax brackets and the respective marginal tax rates for 2024 are as follows:
| Tax Brackets |
Marginal Tax Rates |
| $148,269 or less |
10% |
| $148,270 - $177,922 |
12% |
| $177,923 - $237,230 |
13% |
| $237,231 - $355,845 |
14% |
| $355,846 and over |
15% |
Alberta is Calling attraction bonus
AB Budget 2024 introduces a one-time $5,000 refundable tax credit to certain skilled workers who move to Alberta after the program start date in April 2024. To qualify, an individual must work full time in a designated occupation, file a 2024 Alberta tax return, and live in the province for at least 12 months.
Sales and excise tax measures
Electric vehicle tax
AB Budget 2024 introduces a new $200 annual tax on electric vehicles. This tax will be added to the existing vehicle registration fee when owners register their electric vehicles. Hybrid vehicles are exempt from this tax. This measure is proposed to begin on January 1, 2025. More details will be provided in fall 2024.
Vaping tax
AB Budget 2024 introduces a vaping tax that will subject vaping substances sold in the province to a tax rate of $1 per 2mL for the first 10mL, and $1 per 10mL for volume exceeding 10mL. These rates are the same as the federal vaping tax rates. The vaping tax is proposed to begin as early as January 1, 2025.
Tobacco tax
AB Budget 2024 increases the cigarette tax by 2.5 cents, bringing it to 30 cents per cigarette. The budget also increases the tax on smokeless tobacco by 7.5 cents to 35 cents per gram. The increase is proposed to take effect starting March 1, 2024.
Fuel tax
AB Budget 2024 freezes the fuel tax rate for gasoline and diesel at nine cents per litre until at least the end of the first quarter of 2024 (i.e., March 31, 2024). The budget notes that fuel tax rates for following quarters will be calculated according to the average West Texas Intermediate price, which would lower the fuel tax when oil prices are high.
Tourism levy
AB Budget 2024 expands the tourism levy to include online brokers like Airbnb, Vrbo, and Expedia. Specifically, these online brokers will need to collect and remit the levy on temporary accommodations purchased through their marketplace when they collect payment from the purchaser.
This measure is proposed to be effective starting October 1, 2024. Temporary accommodation providers, such as short-term rental hosts, must collect and remit the relevant tourism levy on stays booked before October 1, 2024.
Education property tax
AB Budget 2024 freezes the education property tax rates at $2.56/$1000 of assessed value for residential and farmland properties, and at $3.76/$1000 for non-residential properties for 2024-25.
Land titles registration levy
AB Budget 2024 introduces a new land titles registration levy, set at $5 per $5,000 of value for property transfers and mortgage registrations. AB Budget 2024 notes that proposed legislation for this levy will be introduced in spring 2024.
Other notable measures
Health care – AB Budget 2024 invests an additional $1.1 billion in health care to increase capacity, improve primary care, reduce wait times, increase access to family physicians, and advance the Health Care Action Plan.
Disaster and emergency assistance – AB Budget 2024 increases the amount for contingencies to $2 billion per year to help with unforeseen costs including disasters, emergencies, or other unexpected priorities.
Housing affordability – AB Budget 2024 expands funding for affordable housing supply and supports with an $829 million investment over the next three years. This includes support for:
- Affordable Housing Partnership program, which aims to create 13,000 affordable housing units;
- Seniors Lodge Modernization Program, which provides affordable housing for seniors; and
- Indigenous Housing Capital Program, which addresses housing needs in Indigenous communities.
Education – AB Budget 2024 invests $2.1 billion in constructing and modernizing schools across the province to help expand specialized programs and fund post-secondary education projects for skilled workforce development.
Child care – AB Budget 2024 provides $1.5 billion to reduce child care service costs to an average of $15 per day in 2024 by providing grants to not-for-profit and private child care operators and expanding eligibility for child care subsidies to families with annual earnings up to $180,000. By 2026, the province says that parents can expect to pay an average of $10 per day.
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Disclaimer
The information contained herein is general in nature and is based on proposals that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice or an opinion provided by Doane Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, specific circumstances or needs and may require consideration of other factors not described herein.
