Advocacy | Alberta | Finance & Taxation | Minimum Wage

Alberta announces carbon tax repeal and corporate tax reduction

On Monday, May 13, newly elected Alberta Premier Jason Kenney announced his governments intent to move forward with two centrepieces of the United Conservative platform, the elimination of Alberta’s carbon tax as of May 30, and the first in a series of one percent reductions to Alberta’s corporate tax rate. The government is also expected to introduce legislation next week that will bring a new $13 youth wage to the province.

Alberta Carbon Tax to End May 30

Premier Kenney confirmed that the UPC’s first bill will be The Carbon Tax Repeal Act when the spring session opens on May 21, resulting in an end to Alberta’s carbon tax by May 30 that is currently being charged on home heating using fossil fuels and gasoline at the pump.

This action opens the door to the federal government imposing its tax, as it has done in Ontario, New Brunswick, Manitoba and Saskatchewan – and in recent days Prime Minister Justin Trudeau has indicated no province would be exempt. Kenny is anticipated to continue to support legal challenges fighting the federal carbon tax.

The government proposes replacing the current carbon tax with a program targeting large emitters of greenhouse gases.  RCC will continue to monitor developments.

Corporate Tax Reduction on July 1:

The Job Creation Tax Cut Act will also be introduced next week, and result in a rolling back of Alberta’s General Business Tax rate from 12 percent to 11 percent on July 1.  The tax will continue to drop one percent annually on January 1 until 2022, when it reaches the targeted eight percent rate.

As of July 1, Alberta will have the lowest tax rate on employers in the country, sitting half a percentage point lower than Ontario and the Northwest Territories.

The Open for Business Act:

While yet to be formally announced, the Open for Business Act is also expected to receive its first reading next week and feature the introduction of a youth wage of $13.00 for workers who are 17 years of age or younger in order to incentivize the creation of first-time jobs for unemployed dependent teenagers.

The Act would also see a return to a regular / irregular workday distinction for calculating general holiday pay, return to a holiday pay qualifying period of 30 work days in the last 90 days of employment and allow banked hours to be paid out at regular pay instead of time-and-a-half. The UCP has also pledged that the Act bring balance back to labour legislation.

A separate announcement will be sent out to members once the Act is introduced in coming days.

Next Steps:

  • RCC will continue to support efforts by the new government to reduce taxes and improve business conditions for our members.
  • Updates on each bill will be communicated as information becomes available.
  • RCC expects to be actively engaged in consultations as new Bills are introduced and will ensure our members are well informed and have amble opportunity to provide input as RCC advocates for refinements to proposed regulations.

If you have any questions or concerns, please do not hesitate to contact: John Graham, Director, Government Relations (Prairie Region) at 204-926-8624 or jgraham@retailcouncil.org.

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