Alberta’s small business owners were hoping the provincial budget would recognize the real pressures they’ve been facing: rising costs, chronic labour challenges, and an increasingly uncertain economic outlook. Instead, Budget 2026 introduced a $9.4 billion deficit alongside an increase in education property taxes that will lead to higher operating costs for small business owners.
More costs at the worst possible time
Education property taxes are profit-insensitive, meaning they’re paid whether or not your business is making money. As Keyli Loeppky, CFIB’s Director of Alberta and Interprovincial Affairs explains:
“Property taxes are one of the most harmful forms of taxation because they must be paid regardless of whether a business is profitable. Increasing this burden forces many businesses to delay hiring, scale back investment, or reconsider their future all together.”
A missed opportunity for broad relief
While CFIB welcomes the elimination of the complicated ad valorem wine tax system, the benefit risks being overshadowed by the government’s decision to increase the tax rate under the new flat model.
More broadly, the budget failed to act on key small business recommendations that would have provided immediate and target relief, including:
- Lowering the 2% small business tax rate and raising the eligibility threshold to $700,000 to keep pace with inflation;
- Reducing insurance premium taxes to help counter rising insurance costs; and,
- Addressing the disproportionate education property tax for small firms.
"These changes would have helped businesses reinvest, create jobs, and strengthen local economies,” noted Loeppky.
Alberta risks falling behind other provinces
While the province often points to its low general corporate tax rate, without movement in this year’s budget, its small business rate is no longer as competitive. Other provinces, including Saskatchewan, Manitoba, Nova Scotia and Prince Edward Island, offer lower rates or more generous thresholds for small firms.
“If governments want long-term economic resilience and a stable tax base, they must make entrepreneurship more attractive by lowering the cost of doing business,” said Kayode Southwood, CFIB senior policy analyst for Alberta.
More than four in 10 (45%) of Alberta small business owners say they would discourage their own children from becoming entrepreneurs. It’s a stark warning about the environment small firms are operating in, and about Alberta’s future economic competitiveness.
“Alberta has long been a place where entrepreneurs could thrive, but that advantage is eroding,” added Loeppky. “Small businesses are ready to invest in their communities, but they need a policy environment that supports them. The Alberta government significantly missed the mark this year.”
Join CFIB today and make your voice heard in shaping a stronger, more business-friendly Alberta.
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