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Alberta's Economic Recovery Plan

July 14, 2020

Alberta's Economic Recovery Plan

Synopsis
5 Minute Read

Alberta's Recovery Plan outlines economic incentives for corporations and businesses in response to COVID-19.

The provincial government announced on June 29, 2020, Alberta’s Recovery Plan in response to COVID-19. The economic plan included the acceleration of the Job Creation Tax Cut, the Innovation Employment Grant and the Small and Medium Enterprise Relaunch Grant, as well as other incentives. 

Job Creation Tax Cut - Reduction to Alberta Corporate Tax Rate

Alberta corporations welcomed the announcement of the acceleration of the Job Creation Tax Cut which will see the general corporate income tax rate reduced to eight percent (from ten percent) as of July 1, 2020, a year and a half ahead of schedule. Originally, the corporate income tax rates were set to decrease from twelve percent in 2019 to eight percent on January 1, 2022. 

Alberta’s 2020 corporate income tax rates on business income are as follows:

January 1, 2020 As of July 1, 2020
Jurisdiction General Small Business ¹ Jurisdiction General Small Business ¹
Federal 15% 9% Federal 15% 9%
Alberta 10% 2% Alberta 8% 2%
Combined 25% 11% Combined 23% 11%

¹ On the first $500,000 of active business income

Innovation Employment Grant

The Innovation Employment Grant will provide a refundable tax credit to companies that invest in research and development in Alberta. Designed to incentivize job creation in high-growth industries, this tax credit is targeted at smaller, pre-income firms performing research and development that are not immediately benefitting from the corporate tax cut. Alberta is encouraging new start-ups to locate and grow their businesses in Alberta. Specific program details including criteria are yet to be released.

Small and Medium Enterprise Relaunch Grant

The Small and Medium Enterprise Relaunch Grant provides financial assistance to Alberta businesses, cooperatives, and non-profit organizations that have less than 500 employees and were ordered to close or curtail operations as a result of public health orders to help offset a portion of their relaunch costs.

Grant Amount

Eligible organizations can apply to receive up to percent of their pre-COVID-19 monthly revenue, with a maximum of $5,000 in one-time funding per business. 

Eligibility

  • Applicants will be required to demonstrate a revenue decline of at least 50 percent in April and / or May 2020 in comparison to April 2019, May 2019 or February 2020 as a result of public health orders.
  • The organization will not qualify for the program if it received any payments, grants, or amounts from any other sources, including insurance, to replace or compensate for the loss of revenue / earned revenue. However, organizations are permitted to receive amounts from these government assistance programs such as:
    • Business Credit Availability Program (BCAP)
    • Canada Emergency Business Account (CEBA),
    • Canada Emergency Wage Subsidy (CEWS) and
    • Canada Emergency Commercial Rent Assistance (CECRA).

Application Dates

Applications opened on June 29, 2020 and will remain open until August 31, 2020, or for four weeks following the start of Phase 3 of Alberta’s Relaunch Strategy, whichever is later.

How to Apply / Estimated Payment Date

Organizations must apply through the online application portal www.alberta.ca/sme-relaunch-grant.aspx

Applicants must create a MyAlberta Digital ID (MADI) user account if they do not already have one. 

Alberta aims to process the applications within 10 business days following submission.

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