Alberta Budget 2019: Job Creation Tax Cut and Enhanced Capital Cost Allowances
The following are the important facts and information you need to know regarding Alberta’s corporate tax measures:
• The Job Creation Tax Cut is a legislated plan to reduce Alberta’s general corporate income tax rate from 12% to 8%. Under this plan, the rate was reduced to 11% last July 2019 and will be reduced further by 1% on January of each year until reaching 8% by January 2022.
• By 2022, Alberta’s rate will be 30% lower than the next lowest announce provincial rate.
• The Job Creation Tax Cut is aimed at driving private investment and economic activity among corporations in Alberta.
• Once fully implemented, it is estimated that the lowered rates will benefit over 100,000 Alberta businesses in all sectors of the economy.
• Budget 2019 forecast estimates that the reductions will increase investment by about $4 billion per year by 2023.
• To further improve Alberta’s competitiveness, Budget 2019 includes the enhancement of the capital cost allowance rates. This will allow corporations to claim the costs of new capital assets more quickly for tax purposes.
• With this measure, corporations will be able to immediately claim the full costs of manufacturing and processing equipment and clean energy generation equipment. Corporations will also be eligible to claim up to three times the normal first-year cost allowance related to other capital investments.