The UCP government has reduced Alberta’s corporate tax rate from 11 per cent to 10 per cent as part of the ongoing Job Creation Tax Cut.
This scheduled tax reduction, effective Jan. 1, improves Alberta’s competitiveness and encourages businesses to invest and hire in the province, the government said in a release Wednesday.
“It will take time to reverse the damage done to Alberta’s economy, but we are seeing positive signs that the Job Creation Tax Cut is working,” said Finance Minister Travis Toews. “We expect more good news of increased investment as the rate continues to decrease and businesses make new plans. We will continue to work to attract investment to Alberta.”
Canadian Natural Resources Limited (CNRL) announced plans to expand its operations in response to the Job Creation Tax Cut. In early December, CNRL increased its 2020 capital budget by $250 million, which they estimate will create about 1,000 new full-time jobs for Albertans.
Telus also announced a $16-billion investment in Alberta over the next five years connecting businesses and homes across the province to fibre and preparing for 5G. The investment comes with an anticipated 5,000 jobs over the course of the project.
“By lowering taxes on job creators, the Alberta government is trying to get Albertans back to work the right way. These tax reductions will help Albertans get back on their feet and get ahead,” says Canadian Taxpayers Federation, Alberta director, Franco Terrazzano.
Alberta’s general corporate income tax rate is the lowest in Canada. Alberta’s combined federal-provincial corporate tax rate will be lower than that of 44 U.S. states when it reaches 8.0 per cent on Jan. 1, 2022.
The province says non-residential investment in Alberta’s business sector was up by 4.7 per cent year-over-year in the third quarter of 2019, the first annual increase since the second quarter of 2018.
With strong growth in housing starts through the summer, investment in residential construction has improved by more than 21 per cent in 2019 from the multi-year lows seen in late 2018, according to the UCP government.
Building permits, a leading indicator of construction activity, have improved in three of the last four months and were up 3.8 per cent year-over-year in October.
In October, home sales rebounded by more than 11 per cent since they reached an eight-year low in February. Compared to the same month last year, home sales were up by 8.8 per cent.