# 2015 Alberta New Budget



## gladaki (Feb 23, 2014)

For all Albertans
How you think your budget will be getting affected by Alberta New Budget 

http://www.cbc.ca/news/canada/calgary/alberta-budget-2015-5-things-you-need-to-know-1.3011244


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## Barwelle (Feb 23, 2011)

Interesting stat from the government's press release on the budget: The increase in income tax rates affects only 11% of tax filers.

And, I worked it out... Someone who earns $200,000/year would pay $1,500 more in income tax in 2018 than if the 10% flat rate stayed. Even if you had a million dollars of taxable income... you're only paying 17,250 more than if they kept the 10% flat rate. 

Does anyone else think it's a little odd how they implemented the health care levy? I mean, why not have a sliding scale all the way through from the min to the max... they've set it up so that it's a mix of steps and scales. (Zero up till an income of 50k, then it scales up to 200 at 54k, flat until 70k, scales up to 400 at 71.3k, flat till 90k, etc.)

Edit: A little observation... I fueled up yesterday because they announced a 4c increase of fuel tax effective overnight... price at the same gas station was actually lower today by 5c.


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## Mechanic (Oct 29, 2013)

I think that even more cuts to health care and education are going to be more of an issue than small tax increases. Of course, then there is the issue off all the government pay increases as well, which they downplay by offsetting it with job cuts, then tell everyone that their pay increase won't be as big a deal, as they laid off some people !!


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## peterk (May 16, 2010)

I figure my tax bill is going up about $1300 next year. $1000 health premium, $200 income, and $100 liquor, gas, misc. And my income will be about $10k lower this year and about 25k lower next year, than if the price of oil never dropped.

Blows.


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## Plugging Along (Jan 3, 2011)

I think there should have been more taxes and more done.

I think the health premiums should have never been taken away in the first place. Before, I negotiated in all of my jobs to have the premiums paid, now I will be paying the premiums, which I am fine with but if how much would 7 years of premiums be for today. 

I think the the new tax rates should be higher. .5 and 1.5 are nothing in those tax brackets. It's a start but it still doesn't balance. 

Our family will be impacted by about $3000 a year. 

My biggest concerns if they screw around with the education system more. We just made the decision to put our kids publis school, but if this keeps up, we will go back to private school. That will be the largest impact of $20k a year.


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## CalgaryPotato (Mar 7, 2015)

It's funny, in this province, the workers, the companies and the government all act the same. Hey we have extra money, clearly this money will never end so how can we spend it!

I agree the government went too far at cutting revenue and raising spending when times were good. 

I don't know what the right answer for how to fix it right this second is... regardless of where you cut $7billion from in a province of 4 million it's going to hurt.


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## Silverbird (Mar 5, 2013)

Barwelle said:


> Interesting stat from the government's press release on the budget: The increase in income tax rates affects only 11% of tax filers.
> .....
> 
> Does anyone else think it's a little odd how they implemented the health care levy? I mean, why not have a sliding scale all the way through from the min to the max... they've set it up so that it's a mix of steps and scales. (Zero up till an income of 50k, then it scales up to 200 at 54k, flat until 70k, scales up to 400 at 71.3k, flat till 90k, etc.)
> ...


Probably taking a peg from Ontario. Reminded of this since I reviewed my return last night. Takes a whole page to calc for the Health Premium tax, which is really just a handful of major steps between $0 and $1,000 with a bunch of transitional steps in between

Sounds the same, except the zero rate only lasts to $20k and most are looking at $600+
Found a good chart:
http://www.taxtips.ca/ontax/ontariohealthpremium.htm


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## Fraser19 (Aug 23, 2013)

Most of this hardly effects me, well as far as I can see. I don't really have a high income right now 47k.
What I do find funny is all the comments on articles and on Facebook that I see about how people are getting robbed and this is the end of the world. Makes me worry about the people here if they are so engaged about a .5% tax increase that they will hardly have to pay.


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## Silverbird (Mar 5, 2013)

Provincial tax rates still seem much nicer than Ontario at 20.5% with the surtaxes.


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## zylon (Oct 27, 2010)

For many years I've been procrastinating with a move west;
you know, Alberta Advantage and all that poppycock shite.

Less reason to stay here now.
*We're leaving today*
https://www.youtube.com/watch?v=jWf0fd9lIK8


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## Just a Guy (Mar 27, 2012)

It's funny, reading how public sector workers are complaining about he need for more schools, hospitals, etc. yet, every time money is allocated for healthcare, education, whatever the unions are the first to demand higher pay.

When cuts are announced, they talk about the death of the system and greedy politicians...

I was just reading somewhere online how some city was debating replacing 10 "welcome to" signs (I can't remember which Canadian city) at a cost of $3million. I wonder what they build it out of that each sign costs $300k. I also wonder why whatever city doesn't think that amount is absolutely rediculous...

I suppose public money is "free money" to most...grants and subsidies as well...just like condo's have all that cash just to repair an owner's place...

Why does everyone always forget where the money comes from?

Oh, I like the idea of "tax the corporations", as if they won't pass on the costs to consumers...

In the end, it's people who pay for all this...not the government, not corporations, just the people.


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## nobleea (Oct 11, 2013)

I've thought it might not be a bad idea to DROP the corp tax rate a bit and then hike the royalty rates a fair amount. The lowering of the corp tax rate will bring new businesses here and help soothe the pain to oilcos of the royalty increase. Then when prices recover and oil production increases, we get more royalty money.

The rest is just minor amounts. The $10 increase in marriage licenses will bring in a whopping $200K extra. Why bother.
The health care levy is just an income tax since i think it goes straight in to govt coffers and isn't specifically assigned to healthcare.


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## PuckiTwo (Oct 26, 2011)

Just a Guy said:


> I was just reading somewhere online how some city was debating replacing 10 "welcome to" signs (I can't remember which Canadian city) at a cost of $3million. I wonder what they build it out of that each sign costs $300k_. I also wonder why whatever city doesn't think that amount is absolutely rediculous..._
> Oh, I like the idea of "tax the corporations", as if they won't pass on the costs to consumers...


That thinking goes all the way down the chain, from big to small communities. Near us is a tiny community, under 2500 people. With their own mayor and council they are virtually broke. They decided they MUST have a welcome sign - $5000. This is not like your $300k but in this community the $5000 could be spent much better, or even better, saved.


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## AltaRed (Jun 8, 2009)

nobleea said:


> I've thought it might not be a bad idea to DROP the corp tax rate a bit and then hike the royalty rates a fair amount. The lowering of the corp tax rate will bring new businesses here and help soothe the pain to oilcos of the royalty increase. Then when prices recover and oil production increases, we get more royalty money.
> 
> The rest is just minor amounts. The $10 increase in marriage licenses will bring in a whopping $200K extra. Why bother.
> The health care levy is just an income tax since i think it goes straight in to govt coffers and isn't specifically assigned to healthcare.


Most provinces charge a lot more for fees than AB, so they are just catching up. AB still has a ridiculously low land transfer tax and probate tax. And they should introduce a sales tax to even out the revenue stream.

Increasing royalties is a non-starter as that would make companies leave AB like they did before. AB is not that competitive a place to be for oil companies as Canadians like to think. Been there, done that in the oil industry. It is just Albertans have not woken up to that fact and perhaps listen too much to the economy killing NDP.


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## Eder (Feb 16, 2011)

I thought Prentice brought in a reasonable budget. Pickens thinks oil will go back to $100/barrel by end 2016...if so then back to business as usual...if not we'll knuckle down and quit whining right?


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## Barwelle (Feb 23, 2011)

peterk said:


> I figure my tax bill is going up about $1300 next year. $1000 health premium, $200 income, and $100 liquor, gas, misc. And my income will be about $10k lower this year and about 25k lower next year, than if the price of oil never dropped.
> 
> Blows.


It always sucks to pay more tax, but (and I mean this in the nicest way possible) if you make enough money that you're paying the full health levy... I don't really feel that bad that you're paying less than 1% more of your gross. You're into the top 10% of earners in this province, and further up nationally; and probably still paying less tax than you would be anywhere else in the country.



nobleea said:


> I've thought it might not be a bad idea to DROP the corp tax rate a bit and then hike the royalty rates a fair amount. The lowering of the corp tax rate will bring new businesses here and help soothe the pain to oilcos of the royalty increase. Then when prices recover and oil production increases, we get more royalty money.


That's an interesting thought - would make Alberta more attractive for other industries, diversify the economy a bit.

@Just A Guy: nice addition to your sig...!


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## nobleea (Oct 11, 2013)

AltaRed said:


> Increasing royalties is a non-starter as that would make companies leave AB like they did before.


Which companies left? I know there was a lot of talk about it, but I can't think of anything significant that happened. Is suncor or Syncrude going to be able to leave? Saskatchewan? They're dealing with budget issues as well - they'd follow the leader if AB said they would increase royalties.


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## OnlyMyOpinion (Sep 1, 2013)

nobleea said:


> Which companies left? I know there was a lot of talk about it, but I can't think of anything significant that happened. Is suncor or Syncrude going to be able to leave? Saskatchewan? They're dealing with budget issues as well - they'd follow the leader if AB said they would increase royalties.


Leave - mainly in the sense that they would redirect their capital budgets and investment to another area/tax-royalty regime.

I didn't see any big surprises in the bdget and thought the process has been handled well. There is recognition that you can't turn a large ship overnight. Similarly, it will take some time and probably some additional incremental changes to see the light at the end of the tunnel.


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## AltaRed (Jun 8, 2009)

OnlyMyOpinion said:


> Leave - mainly in the sense that they would redirect their capital budgets and investment to another area/tax-royalty regime.


Agreed. I was not clear in saying it was the capital budgets that left. Drilling rigs were headed east, west and south en masse. IIRC, about 50% of available rigs left until idiotic Stelmach had to backpedal some to stop the bleeding. 

The big oil sands producers had no choice but to simply cut back capital projects in Alberta and spend the money elsewhere in other opportunities. Oil sands projects however essentially have pseudo-contracts on royalty rates because of the huge capital investments required and long paybacks. They would be grandfathered in any fiscal regime change. This is generally the way oil business is done worldwide, via production sharing contracts which includes a fiscal contract.


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## Eder (Feb 16, 2011)

Yes...after Stelmach and then Redford its amazing we are in as good a shape as we are...too bad Ralph's kids don't follow up...seems to work for the kid with the nice hair out East.


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## AltaRed (Jun 8, 2009)

I was a born Albertan and an Albertan about half of my working career. So I say with some sincerity that it is shameful AB does not have a sales tax. Spoiled Albertans are spending their grandchildren's money.


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## Just a Guy (Mar 27, 2012)

Could you point to a province that has a sales tax which is doing better? They are just spending the sales tax as well...there'd be nothing for the grandchildren if Alberta had a sales tax...except maybe less inheritance. Even with all the taxes, the other provinces are in deficit.


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## IFITSTOBEITSUP2ME (Mar 6, 2015)

How about this 400% increase!!! Someone buying a $500,000 home with a $400,000 mortgage will now pay $1230 versus currently $280 to register on title. Admittedly we are still better off with no land transfer tax but really 400% increase!


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## sags (May 15, 2010)

There were a lot of fees that went up, from what I have read.

It is one way of raising taxes without raising taxes. The code word now isn't taxes..........it's "revenue" which sounds a lot better.

Paul Martin used psychology very effectively, when he made paying down the debt a priority and something that Canadians could be proud about. It became almost a national obsession........watching breathlessly to see how much of the debt we could pay down each year.

Of course, he pulled all kinds of shenanigans to accomplish it...........downloading costs to someone else etc. but it was an effective political strategy.

When the government slipped into a deficit under Harper, it was big news and over time Canadians have become used to adding to the government debt.........and taking on a lot more of their own debt.

I can remember water cooler talk about how much debt Canadians had paid off, and when the media compared us to the rest of the world, we felt "special".

I think that feeling "special" carried over into Canada escaping the worst of the recession, and residually now into the housing market.

The feeling is getting fainter, as the evidence grows that we may be in more trouble than we thought. 

We are going to need a generation to work through all this debt and will have to hope that nothing happens while we are trying to do it.

Oil prices getting crushed was a black swan event for Canadians. We didn't see that coming.


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## peterk (May 16, 2010)

IFITSTOBEITSUP2ME said:


> How about this 400% increase!!! Someone buying a $500,000 home with a $400,000 mortgage will now pay $1230 versus currently $280 to register on title. Admittedly we are still better off with no land transfer tax but really 400% increase!


Damnit. Missed the news on that one... I am thinking about buying an expensive house in Alberta next year!!!


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## emperor (Jul 24, 2011)

They can tax all they want big GOV doesn't work. Just like GST and everything else they will have their hand out again in 5-10 years.


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## AltaRed (Jun 8, 2009)

IFITSTOBEITSUP2ME said:


> How about this 400% increase!!! Someone buying a $500,000 home with a $400,000 mortgage will now pay $1230 versus currently $280 to register on title. Admittedly we are still better off with no land transfer tax but really 400% increase!


Be happy. In BC, that $500k purchase would cost $8000 in land transfer fees. I understand it is even more in ON.


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## AltaRed (Jun 8, 2009)

Just a Guy said:


> Could you point to a province that has a sales tax which is doing better? They are just spending the sales tax as well...there'd be nothing for the grandchildren if Alberta had a sales tax...except maybe less inheritance. Even with all the taxes, the other provinces are in deficit.


That is not the point because it is well known AB already spends more per capita than any other province. The difference is AB's royalty revenue belongs to all current and future residents of AB. Only a small portion of royalty revenue should be used to support the current population with the balance of revenue requirements supported by a Sales Tax, e.g. 5% might do nicely. The rest of the royalty revenue should be put away for future generations, the original purpose of the Heritage Trust fund. That is what Norway is doing because they know royalty revenue will exhaust itself someday.... the UK is already experiencing that effect.

P.S. As a card carrying C in AB for a number of years, I used to get invited to 'input' sessions with cabinet members. I continually repeated the need for a VAT and called for the courage to get the dialog going. Course every politician wants to be re-elected and so short term is what is important. Future AB residents will someday regret the selfishness of their ancestors. I left AB for good in 2012 for a number of reasons, this one being one of them.


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## Mechanic (Oct 29, 2013)

There is a lot of money wasted in Alberta. I recall reading a comparison of the various government positions and salaries, lot's of extra positions and lot's of overpaid people. Even amongst all the cuts there are going to be more increases for government and politicians while the smoke and mirrors from adjustments helps to divert attention elsewhere......clever.


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## Just a Guy (Mar 27, 2012)

Altared,

My point is, access to more money won't stop the waste, the government will just increase spending. Unions won't stop complaining they aren't paid enough, they'll want more raises, people will want more benefits...they are all addicted to cash. 

It's like giving a child a box of chocolates and expecting them to self regulate...a few might, but most will eat themselves sick.


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## AltaRed (Jun 8, 2009)

Just a Guy said:


> Altared,
> 
> My point is, access to more money won't stop the waste, the government will just increase spending. Unions won't stop complaining they aren't paid enough, they'll want more raises, people will want more benefits...they are all addicted to cash.


That was not my point. It is not access to more money. Restrict by law access to only X% of annual resource royalty revenue for annual budgets putting the rest into the Heritage Trust Fund and using, for example, a 5% sales tax to provide relative steady revenues. For example, if a 5% sales tax brought in $5 billion, then make sure the offset is royalty resource revenue into the Heritage Trust Fund. The AB gov't and the public have got the whole thing screwed up. They need to look at the Norway model and have the discipline to stay the course.


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## 5Lgreenback (Mar 21, 2015)

After working with a couple different branches of the Alberta government, and seeing how wasteful and inefficient it is, I am of the opinion that government cut backs and elimination of many positions and bureaucracy are a much better option than raising taxes. And I'm not talking about the front line workers in healthcare or education, they are necessary. Its a spending problem, not a tax problem. 

Unfortunately, Alberta is a victim of its own success, the cost of living has increased dramatically with the oil industry jobs and opportunities. As it stood, even before the new taxes that will be absorbing 2-2.5% of my annual income, I would have had a lower cost of living in BC at my current income (with the exception of the Vancouver area). So much for the alberta "conservative" advantage.


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## Just a Guy (Mar 27, 2012)

AltaRed said:


> That was not my point. It is not access to more money. Restrict by law access to only X% of annual resource royalty revenue for annual budgets putting the rest into the Heritage Trust Fund and using, for example, a 5% sales tax to provide relative steady revenues. For example, if a 5% sales tax brought in $5 billion, then make sure the offset is royalty resource revenue into the Heritage Trust Fund. The AB gov't and the public have got the whole thing screwed up. They need to look at the Norway model and have the discipline to stay the course.


From what I remember, it was legislated...they also legislated no more government deficits under Ralph I beleive...the temptation is too great for these "leaders". It's easy to change the law in any majority government. Federally, things went south as soon as the conservatives got the majority (not because they were conservative, I think the liberals screwed things up equally well before, but because they now had the ability to screw things up). The minority governments prevent governments from doing anything...which is probably the best thing we could hope for.

I also don't buy the "high cost of living" excuse...if people can survive In Vancouver and Toronto, Alberta has no excuses.

The fact is, most people are greedy, and live for the "now" as opposed to the future. Look at how many people are living paycheque to paycheque, in debt up to their ears as opposed to retired early.


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## AltaRed (Jun 8, 2009)

So the answer is to do nothing? If so, AB will really be a basketcase waiting to happen.


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## Eder (Feb 16, 2011)

I think Prentice has done something....the fact he left off a sales tax has nothing to do with it. We are Alberta....not Scandinavian or Ethiopian or Venezuelan...I think we can decide for ourselves how we want our economic model to proceed...(I did when I voted)


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## Just a Guy (Mar 27, 2012)

AltaRed said:


> So the answer is to do nothing? If so, AB will really be a basketcase waiting to happen.


I'm saying most politicians are the same...if you're waiting for one to save you, I've got a nice bridge for sale as well...you'll be able to retire in no time.

The definition of insanity is doing the same thing over and over, but expecting different results.


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## mind_business (Sep 24, 2011)

Alberta did itself a disservice years ago when the decision was to rely on oil revenues in lieu of, or at least partially offset by a Provincial Sales Tax. Now, it will sound the death knell for any Party that starts to talk about it. What would have been palatable to the average voter years ago, is a smaller 2.5% Tax that could have been raised or lowered a percent to reflect the Albertan economy. I think Prentiss's only option now, if he was to introduce a sales tax, is to put a 'temporary' one in place, with an assurance it will be removed once the economy ramps up again. This will give Albertan's time to get used to paying a tax ... and no doubt it will never be removed entirely. Yes, I'm thinking like a politician. This is the safest way to stop relying on the cyclical oil revenues.

It's an absolute disgrace that Government and Voter greed has allowed the Heritage fund to be raided to the point where it's no longer able to provide much during the Economic downturns. It's like when you were a kid, given a choice between saving the $100 your grandparents just gave you, or spending it on toys ... most will choose toys. Apparently our Governments over the years, and the Voters who elected them in time-after-time, have not matured financially much beyond their childhood years. Yes, I know that the average MF member knows these lessons well, but the average Voter certainly has not. It's all about 'give-me, give-me, give-me RIGHT NOW!, and screw the future generations'.


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## OnlyMyOpinion (Sep 1, 2013)

Except for the item-specific 'sin' and fuel taxes, it seems that the Alberta gov't plans to work largely within the personal income tax (T1) system - the health care contribution levy, family tax credit, new tax brackets, etc. 
A sales tax treats everyone the same - I'd pay the same 5% on an item whether I make $24k/yr or $250k/yr. Working within the income tax system will allow them to be more 'progressive' in favouring lower income families, they can make future 'tweaks' more easily, they work within the current system (no new bureaucracy), and they don't require the large scale vendor implementation that a sales tax does?


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## andrewf (Mar 1, 2010)

It's possible to make sales tax progressive by introducing rebates such as the HST rebate. And sales taxes are a great way to raise a lot of revenue without causing a lot of economic harm. It would require almost nothing for Alberta to implement a sales tax, as the HST collection infrastructure already exists.


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## Westerncanada (Nov 11, 2013)

My biggest concern with all of these changes was that there was not a timeline set. I would be completely on-board in the event they said we will put these measures in place until we reach 'xx' amount of Oil Revenue again and then we will scale it back but after years of record high oil prices we face 6 months of a slump and then are all being forced into paying higher taxes across several measures. 

I am much more a fan of the variable rate model as this essentially feels as though they will be happy to keep these taxes even as the oil royalties climb back up so they can fund a bunch of things that the people don't need or want or have a say in. 

Pretty disappointing.


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## leeder (Jan 28, 2012)

My biggest disappointment with the budget is that the government nixed the idea of raising corporate income taxes. Alberta's general corporate tax rate sits at 10%, which is the lowest in Canada. The government's rationale for not increasing the rate is because of the fear of job loss (i.e., companies shut down) and the province would not be as competitive compared to other provinces. Yet, there are articles that show a 1% increase would bring in $300-$400 million. Yes, it won't solve the $7 billion shortfall... but it surely contributes to reducing it! Indeed, certain companies looking to start up in Alberta may look elsewhere. However, energy companies will still likely to operate in the province. As for the whole issue about job loss, there are already job losses in Alberta regardless of whether taxes go up. If companies cannot handle a 1% increase in taxes, one should question whether the companies should even operate.


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## AltaRed (Jun 8, 2009)

The issue is companies moving their corporate office out of province and thus paying CIT to another province. It does not cost much to move the corporate office, likely less than $100k/management person (all in - including office costs, moving costs, etc). The lesserlings, i.e. support staff, get laid off (not moved). THAT is what it is all about.


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