Implementing Budget 2025

Changes:

• introduce a new personal income tax bracket of 8%, down from 10%, on the first $60,000 of income
• introduce a non-refundable tax credit for Albertans who have certain non-refundable tax credits that total to $60,000 or more

These changes lower personal income taxes for more than 2 million Alberta taxpayers, saving Albertans about $1.2 billion in 2025.

Other amendments wind up 2 previously cancelled tax credit programs after December 31, 2025, eliminating any ongoing operational costs.

Changes:

• align Alberta’s legislation with changes to the federal Income Tax Act
• align Alberta’s General Anti-Avoidance Rule with equivalent federal provision

Changes:

• repeal the establishment of the provincial audit committee, as it was only advisory
• ensure the Auditor General’s draft reports continue to be shared with the government and the public

Public review of auditor general reports continues through the Public Accounts Committee.

Changes:

• update fiscal rules to allow the first 50% of surplus cash to be used to repay maturing debt or saved in the Heritage Fund to improve Alberta’s net financial position
• remove timing requirement to use surplus cash to repay debt coming due in that fiscal year
• make the Treasury Board responsible for surplus cash allocation

Changes increase the fuel tax for locomotive fuel to 6.5 from 5.5 cents per litre effective March 1, 2025, bringing Alberta’s tax rate for this fuel type closer to the rates applicable in the other prairie provinces.

Changes:

• double statutory contributions from the Alberta Law Foundation to Legal Aid Alberta to 50% from 25%
• require ministerial approval of all Alberta Law Foundation grants and other financial commitments over $250,000

These changes ensure Legal Aid Alberta funding is maintained at an adequate level, while finding efficiencies to ensure Albertans have access to an affordable justice system.

Changes:

• make it simpler to adjust benefit rates under the Income Support program
• standardize approaches to benefits to be consistent for all programs and provide flexibility to ensure rates can be adjusted to better address client needs in response to economic circumstances

Amendments to the Income and Employment Support Act will take effect July 2026 in alignment with the implementation of the new Alberta Disability Assistance Program.

Changes discontinue development and implementation of the supplemental health benefits program for adoptive families. Current subsidies and tax breaks continue.