Forecast

Provincial revenue is projected to be $45 billion in 2017-18, which is in line with the Budget 2016 forecast.

Table 1: Budget 2017 Revenue (millions of dollars)

Source: Treasury Board and Finance
Revenue sources 2015-16 Actual 2016-17 Budget 2016-17 Forecast 2017-18 Estimate 2018-19 Target 2019-20 Target
Income and other taxes 20,720 21,767 20,546 21,762 23,323 24,662
Non-renewable resource revenue 2,789 1,364 2,430 3,754 4,226 6,628
Transfers from Government of Canada 7,142 7,278 7,943 7,988 7,870 8,079
Investment income 2,544 2,115 2,886 2,193 2,231 2,315
Net income from government business enterprises 2,570 2,416 2,404 2,506 2,568 2,662
Premiums, fees and licences 3,574 3,649 3,646 3,683 3,770 3,863
Other 3,161 2,846 3,083 3,129 3,655 3,573
Total Revenue 42,500 41,435 42,938 45,015 47,643 51,782

Non-renewable resource revenue

Lower oil prices and their impact on the provincial economy continue to affect government revenue. Revenue from non-renewable resources is forecast at $3.8 billion in 2017-18, a level well below averages over the past decade.

Table 2: Non-renewable resource revenue (millions of dollars)

Source: Treasury Board and Finance
Resource revenue sources 2015-16 Actual 2016-17 Budget 2016-17 Forecast 2017-18 Estimate 2018-19 Target 2019-20 Target
Bitumen royalty 1,223 656 1,263 2,546 3,198 5,269
Crude oil royalty 689 333 600 476 460 589
Natural gas & by-products royalty 493 151 219 455 304 523
Bonuses & sales of Crown leases 203 95 191 148 144 134
Rentals and fees 167 118 144 117 109 103
Coal royalty 14 11 13 12 11 10
Total resource revenue 2,789 1,364 2,430 3,754 4,226 6,628

Carbon pricing revenue

The Climate Leadership Plan places an economy-wide price on carbon emissions through a carbon levy on heating and transportation fuels, and performance standards on large industrial emitters.

The carbon levy is estimated to raise $1 billion in 2017-18. Even with the carbon levy, Alberta will have the third lowest provincial taxes/levies on gasoline and diesel in 2017, after Saskatchewan and Manitoba.

Over the next 3 years, $5.4 billion in gross carbon pricing revenue will be fully invested in efforts to save energy, create opportunities to diversify Alberta's economy, and to help households, businesses and communities adjust to the carbon price and reduce emissions.

Table 3: Carbon levy revenue (millions of dollars)

Source: Treasury Board and Finance
Carbon levy revenue and adjustment funding 2016-17 Forecast 2017-18 Estimate 2018-19 Target 2019-20 Target 3-Year Total
Gross Levy Revenue 230 1,038 1,396 1,416 3,850
    Small business tax reduction (40) (175) (190) (200) (565)
    Household rebates (90) (410) (550) (550) (1,510)
Levy revenue subtotal 100 453 656 666 1,775

Income taxes

Alberta maintains the lowest overall tax regime in Canada, with no provincial sales tax, health premium or payroll tax.

Business taxes

As part of the Climate Leadership Plan, Alberta’s small business corporate income tax rate was reduced from 3% to 2% effective Jan 1, 2017, to help businesses adjust to the carbon price.

The tax relief will be worth an estimated $175 million in 2017-18 to small business owners.

Alberta is now tied with Saskatchewan for the second-lowest provincial small business rate. While Manitoba’s small business rate is lower, Alberta small business owners pay less taxes when they take money out of their business for personal use.

Alberta’s corporate tax rate remains at 12%.

Personal income taxes

Alberta’s tax system is indexed to inflation, ensuring that the value of tax credits is not eroded over time, and that taxpayers are not pushed into higher tax brackets. In 2017, the basic personal and spousal amounts will increase 1.3% to $18,690 – the highest among the provinces.

Indexing the personal income tax system is estimated to save Albertans $70 million in 2017.

Alberta’s progressive, multi-rate income tax system took effect October 1, 2015.

Table 4: Income tax rates

Source: Treasury Board and Finance
Tax Rate 2016 Taxable Income Brackets 2017 Taxable Income Brackets
10% On first $125,000 On first $126,625
12% On next $25,000, from $125,000 to $150,000 On next $25,000, from $126,625 to $151,950
13% On next $50,000, from $150,000 to $200,000 On next $50,000, from $151,950 to $202,600
14% On next $100,000, from $200,000 to $300,000 On next $100,000, from $202,600 to $303,900
15% Above $300,000 Above $303,900

Alberta's tax advantage

Albertans across all income ranges will continue to pay the lowest overall taxes when compared to other provinces.

This bar chart shows Albertans pay between $8.7-22.4 billion less taxes than other provinces

This graph shows the total additional provincial tax and carbon charges that individuals and businesses would pay if Alberta had the same tax system and carbon charges as other provinces. This information reflects tax rates for other provinces known as of March 22, 2017.

A minimum carbon charge of $10/tonne is assumed in 2018 for all provinces according to the federal government’s carbon pricing plan. This comparison includes personal and corporate income tax, sales tax, fuel tax, carbon charges, tobacco tax, health premiums, payroll tax, liquor tax and markups, land transfer tax and other minor taxes.

Source: Treasury Board and Finance