Tax Flash Bulletin
2022 Alberta Budget Highlights
On February 24, 2022, Alberta’s Minister of Finance, Travis Toews, tabled the province’s 2022-2023 budget with a forecasted surplus of $500 million and further surpluses of $900 million for 2023-2024 and $700 million for 2024-2025. The government projects a deficit of $3.2 billion for the current 2021-2022 fiscal year compared to the $18.2 billion deficit the government budgeted last year. We have highlighted selected tax measures relevant to individuals and small businesses in Alberta.
INDIVIDUALS
Personal Tax Rates
The budget did not propose any changes to individual income tax rates for 2022 or introduce any new taxes. The provincial government paused the indexation of tax brackets starting with the 2020 taxation year.
Provincial Income Tax Brackets and Tax Rates
| 2021 and 2022 Taxable Income | Rate |
|---|---|
| $0 up to $131,220 | 10% |
| $131,220 up to $157,464 | 12% |
| $157,464 up to $209,952 | 13% |
| $209,952 up to $314,928 | 14% |
| Over $314,928 | 15% |
Top Combined Alberta and Federal Rates
| Income Type | 2021 | 2022 |
|---|---|---|
| Salary, interest, pension, foreign | 48.00% | 48.00% |
| Eligible dividends | 31.71% | 34.31% |
| Non-eligible dividends | 42.31% | 42.31% |
| Capital gains | 24.00% | 24.00% |
Top tax rates apply to taxable income over $314,928 based on known federal and Alberta rates at February 24, 2022..
Reconfiguration of Alberta Income Supports
In 2021, the federal budget introduced enhancements to the Canada Workers Benefit (CWB) which is applicable to lower-income individuals and families. The Alberta budget indicates that it has aligned the federal phase-in income level with the Income Support (IS) earnings exemption threshold to help offset the impact of the claw back on Alberta IS benefits as a recipient’s employment income rises. Under the reconfigured benefit, no CWB recipient will receive a lower provincial benefit and many will receive a higher benefit.