Alberta Budget 2026

The budget introduced the new Alberta Caregiver Credit, which consolidates the existing caregiver and infirm dependent credits, and also introduced a new tax on certain short-term vehicle rentals in the province. The budget didn’t introduce or make changes to any business tax measures.

AB Budget 2026 revises the projected 2025-26 deficit for the fiscal year (ending March 31) to be $4.1 billion based on the final forecast, compared to the $5.2 billion deficit originally budgeted for the 2025-26 fiscal year.

Fiscal projections for the next three years are as follows:

Business tax measures

Corporate tax rates

AB Budget 2026 makes no changes to the corporate tax rates or the $500,000 small business limit.

2026 combined federal and Alberta corporate tax rates

Personal tax measures

Personal tax rates

No changes were announced to personal income tax rates. Personal income tax brackets and certain non-refundable tax credits are subject to an annual indexing for inflation.

The indexed personal tax brackets (combined federal and provincial) and the respective marginal tax rates for 2026 are as follows:

Alberta Caregiver Credit

The budget introduces the Alberta Caregiver Credit to replace the existing Caregiver Credit and Infirm Dependent Credit. The new credit will be available to Albertans who care for and reside with an eligible adult relative due to mental or physical infirmity. A taxpayer will be able to claim the new credit in respect of spouse with a mental or physical impairment. However, the credit is no longer available in respect of parents or grandparents with no mental or physical impairment (unlike under the existing caregiver credit).

The credit offers a maximum tax savings of $1,054 and is reduced where the dependant’s income exceeds $20,956 (with the credit fully phased out where the dependant’s income reaches $34,136). This measure will be effective starting in 2027.

Sales and excise tax measures

Vehicle rental tax

AB Budget 2026 introduces a new vehicle rental tax equal to 6% of the vehicle rental price. This tax applies to short-term rental passenger vehicles in Alberta with seating for eight or fewer passengers. It doesn’t apply to vehicles under long‑term leases or to non‑passenger vehicles. The tax is calculated before the federal goods and services tax (GST) is applied and excludes itemized charges for insurance and fuel. This new tax will take effect on January 1, 2027, with further details expected in fall 2026.

Tourism levy

Tourism levy rate will increase to 6% (from 4%) effective April 1, 2026. This levy applies to the price of short‑term accommodation, including hotels, motels, and inns, in Alberta.

Education property tax

The education property tax rate for residential and farmland properties increases to $2.84 (from $2.72) per $1,000 of equalized assessment, while the rate for non‑residential properties increases to $4.17 (from $4.00) per $1,000 of equalized assessment.

Have questions? Let’s talk. Contact your local advisor or reach out to us here.

Visit our Budget 2026 hub to learn more about all federal and provincial budgets.

^{Disclaimer 
The information contained herein is general in nature and is based on proposals that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice or an opinion provided by Doane Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, specific circumstances or needs and may require consideration of other factors not described herein.}