Alberta Taxpayer Protection Amendment Act, 2023

Summary#

• This law changes Alberta’s Taxpayer Protection Act. It now requires a province-wide vote (referendum) before the government can introduce a bill to add a general provincial sales tax or raise income taxes.

• It also defines what counts as an “income tax increase” for both people and corporations.

• Key changes:

  • No bill to create a provincial sales tax can be introduced unless voters approve it in a referendum.
  • No bill to raise personal or corporate income taxes can be introduced unless voters approve it in a referendum.
  • “Income tax increase” includes raising tax rates, or cutting key dollar amounts or deductions in ways that make people or businesses pay more.
  • The law links to Alberta’s Referendum Act for how any required referendum must be run.
  • It does not block tax cuts.

What it means for you#

• General public

  • You would get a direct vote before the province could add a sales tax or raise income taxes.
  • Day-to-day taxes do not change because of this law. It only sets a rule for how future tax increases could happen.

• Workers and families

  • Your personal income tax rate cannot be raised without a province-wide vote.
  • The government also cannot lower key basic amounts (like the basic personal amount that reduces your taxes) in a way that makes you pay more, unless voters approve it first.

• Business owners and corporations

  • The general corporate income tax rate cannot go up without voter approval.
  • The province cannot reduce certain deductions or credits in ways that increase corporate taxes unless voters approve it (unless matched by a tax rate cut that offsets it).

• Taxpayers generally

  • The government can still change other taxes or fees (for example, fuel taxes or fees for services) without a referendum. This law specifically targets a provincial sales tax and income tax increases.
  • Municipal property taxes are not affected. Cities set those on their own.

• Timing and process

  • A referendum must happen, and its result must be announced, before any bill to add a sales tax or raise income taxes can even be introduced in the Legislature.

Expenses#

• At a glance: Costs would occur only if the province holds a referendum.

• Running a province-wide referendum costs money (staff, polling stations, ballots). Costs can be lower if a referendum is held at the same time as another election.

• No publicly available information.

Proponents' View#

• Voters should have the final say on big tax hikes that affect every household and business.
• This keeps Alberta’s “low tax” approach and makes surprise tax increases less likely.
• It creates stability and predictability for families and employers planning their budgets.
• The detailed definition of “income tax increase” stops “backdoor” hikes through cutting credits or deductions.
• The government can still cut taxes or use other tools without extra steps.

Opponents' View#

• It ties the hands of future governments that may need to raise revenue during downturns or emergencies.
• Referendums cost money and take time, which could delay urgent budget decisions.
• Limiting income tax changes could push governments to raise other fees or narrower taxes that can be less fair.
• Complex tax fixes (like adjusting credits for fairness) might be harder if they could be seen as increases requiring a referendum.
• Elected representatives already answer to voters; adding referendums may reduce flexibility in normal budgeting.