Provincial tax credit for small business aimed at creating jobs
The Alberta government plans to introduce a tax credit for investments in small businesses in the fall sitting of the legislature.
Economic Development Minister Deron Bilous says there will be a 30 per cent tax credit for investments in Alberta small businesses made between April 14 of this year and Dec. 31, 2019. The government said the tax credit, part of its jobs plan, would support up to 4,400 new jobs over three years and contribute up to $500 million to the province’s GDP.
Bilous said the government is also restoring training programs for entrepreneurs, cutting the small business tax and protecting a multibillion-dollar tax advantage over other provinces.
Justin Smith with the Calgary Chamber of Commerce said the province has large pools of capital but until today, policy measures were sorely needed to encourage the flow of this capital into the province’s small businesses.
“This tax credit puts the onus on investors to make the final decision on risk and efficiency, while keeping their money in Alberta and putting it toward growth-oriented firms,” Smith said in a news release Thursday.
The tax credit legislation, if passed, will have a budget of $90 million over three years and would be provided on a first-come, firstserved basis.
It will be available for investments in companies that are substantially engaged in proprietary technology research, development or commercialization; interactive digital media development; video post-production; digital animation; or tourism.
Details of the credit were announced the same day the Canadian Federation of Independent Business said optimism among small business owners in Alberta remains among the lowest in the country.
Its monthly members’ survey found small business confidence gained 1.5 points to 47.1 last month, with a record 68 per cent of respondents citing wage pressure as a major cost issue.
“Everyone recognizes current market conditions are severe and unfavourable for entrepreneurs. The real questions is: why is the Alberta government piling on, making a bad situation worse?” Amber Ruddy, the CFIB’s director of provincial affairs for Alberta, said in a statement.
"Every single policy the premier implements must be sensitive to the harsh economic reality small business owners face.”
Eighteen per cent of respondents rated the general state of business health as good, while 37 per cent said they are in bad shape. Twentyseven per cent said they expect to cut back on staff, with 10 per cent planning to hire during the next three months.
Nationally, the CFIB index fell to 59.0, led by Quebec (67.1), PEI (63.9) and British Columbia (63.3). Newfoundland & Labrador, at 41.1, posted the lowest mark, followed by Alberta and Saskatchewan (54.1).
Every single policy the premier implements must be sensitive to the harsh economic reality small business owners face.