The most significant change coming into effect January 1, 2009, is the elimination of health care premiums, which will save Albertans and Alberta businesses about $1 billion annually. Individuals who pay the premium will save $528 a year, while couples and families will save $1,056 a year. Businesses that pay some or all of their employees’ premiums will save the amount they pay, thereby freeing up money for potential additional investment.

Albertans will also see an increase in their provincial tax credits. In 2009, the basic and spousal exemption amounts, along with other credits, will increase 3.8 per cent to offset 2008 inflation. This means the basic, spousal and equivalent-to-spouse amounts will increase to $16,775 in 2009, up from $16,161 last year. Other tax credits such as those for caregivers, Albertans with disabilities, and working families with middle to lower incomes will also be increased to offset inflation. 

In addition to personal tax cuts, the province has taken steps to increase investment in the province to boost and broaden the economy. The Alberta Scientific Research and Experimental Development tax credit will encourage companies to do more research and development in the province and make Alberta a more attractive location for knowledge intensive companies. This tax credit - an initiative under the Bringing Technology to Marketaction plan - benefits all eligible companies, but is especially important for start-ups and early-stage companies because it allows them to benefit from the credit even though they may not be earning enough income to pay income taxes. 

“With these changes to the province’s tax system, Alberta remains, by far, the lowest-taxed jurisdiction in Canada,” said Evans. If Albertans and Alberta businesses were in any other province, they would pay between about $10 billion and $18 billion more in taxes every single year -- about $3,000 to $5,000 per capita.