Alberta
Alberta government can soften blow of Ottawa’s capital gains tax hike

From the Fraser Institute
By Tegan Hill
Several wealthy and successful industrialized countries (Switzerland, New Zealand, Singapore) and several U.S. states (including Texas, Alaska, South Dakota, Wyoming) impose no capital gains taxes. Of course, Alberta competes with these U.S. states for investment.
Earlier this year, the Trudeau government increased the inclusion rate on capital gains over $250,000 for individuals and on all capital gains realized by corporations and trusts. This tax hike will almost surely have a negative impact on investment and entrepreneurship, but the Smith government can lessen the blow in Alberta.
In simple terms, capital is money invested in an asset—e.g. a business, factory, intellectual property, stock or bond—to create economic benefit. A capital gain occurs when that investment is sold for more than its original purchase price.
Prior to the tax hike, half the value of a capital gain (50 per cent) was taxed by the government. Trudeau increased this “inclusion rate” to 66 per cent—and that has real economic consequences.
Why? Because capital gains taxes impose comparatively large costs on the economy by reducing the reward from productive activities such as savings, investment, risk-taking and entrepreneurship, which are essential for strong economic growth. Capital taxes are among the most economically damaging forms of taxation for this very reason—they reduce the incentive to innovate and invest.
Take an entrepreneur, for example, who’s deciding whether or not to risk their own capital to provide (and profit from) a new technology, product or service. The higher the capital gains tax, the lower the potential reward from this investment, which means they will be less inclined to make the investment or perhaps undertake the investment elsewhere (another country, for example) in a more tax-friendly environment. Less investment means less innovation, job creation, wage growth and ultimately lower living standards. In other words, Trudeau’s capital gains tax hike will not only hurt Canadians with capital gains but other Canadians who benefit from the knockoff effects of investment.
Largely due to this problem, several wealthy and successful industrialized countries (Switzerland, New Zealand, Singapore) and several U.S. states (including Texas, Alaska, South Dakota, Wyoming) impose no capital gains taxes. Of course, Alberta competes with these U.S. states for investment.
Previous federal governments also understood the disincentive that comes with capital gains taxes. In 2000, the Liberal government of Jean Chretien meaningfully reduced the tax rate applied to capital gains stating that we must “introduce tax measures that encourage entrepreneurship and risk taking.”
Today, fortunately, the Smith government can take action.
When governments tax your capital gain, they include a share of the gain in your personal income and it is taxed at your personal income tax rate. The Alberta government could simply add a step in the tax return process for Albertans to remove capital gains from the provincial income tax calculation. As a result, the capital gains tax would only apply to the federal portion of your income taxes.
The Alberta government doesn’t have to sit back and accept Trudeau’s capital gains tax hike. Eliminating capital gains taxes from the provincial income tax in Alberta would send a powerful message to potential entrepreneurs, investors and businessowners that the province is open for business—and that benefits all Albertans.
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Alberta
Diploma Exams Affected: No school Monday as ATA rejects offer of enhanced mediation

Premier Danielle Smith, Minister of Finance Nate Horner, and Minister of Education Demetrios Nicolaides issued the following statement.
“Yesterday, the Provincial Bargaining and Compensation Office wrote to the Alberta Teachers’ Association (ATA) and formally requested an agreement to enter an enhanced mediation process.
“This process would have ensured that students returned to the classrooms on Monday, and that teachers returned to work.
“Negotiating would have continued with the ATA, Teachers’ Employer Bargaining Association (TEBA) and a third-party mediator to propose a recommended agreement.
“We are very disappointed that the Alberta Teachers’ Association refused this offer. Teachers and students should also be disappointed.
“PBCO made this offer to the ATA because the union has not made a reasonable offer and this strike is impacting students. Alberta’s government is trying to put kids first and bring an end to this strike.
“The offer of enhanced mediation provided a clear path to ending it.
“We want the same things as the ATA: More teachers. More pay for teachers. More educational assistants. And more classrooms.
“This strike has gone on too long and we are extremely concerned about the impact it is having on students.
“We are willing to consider further options to ensure that our next generation gets the world-class education they deserve. After about three weeks, a strike of this nature would reach the threshold of causing irreparable harm to our students’ education.
“The ATA needs to do what is right for its members, and for all Alberta students.
“If it refuses to do so, we will consider further options to bring this strike to an end.”
Diploma exam update
November diploma exams will be optional for students.
With instructional time in schools disrupted due to the teacher strike, the November 2025 diploma exams will now be optional for students. Students who wish to write a diploma exam may request to do so, and their school boards will accommodate the request.
The optional diploma exams apply to all schools provincewide. These exams will still take place on the currently scheduled dates.
Students who choose not to write the November diploma exams can still complete their courses and graduate on time. Their final grade will be based entirely on the school-awarded mark provided by their teacher.
Choosing not to write the November diploma exams will not affect a student’s ability to apply to, be accepted by, or attend post-secondary institutions after graduation.
No changes have been made to the January and June diplomas and provincial achievement tests.
Quick facts
- Students are automatically exempted from writing the November diploma exams but can request to write them.
- School boards must allow the student to write the diploma exam if requested.
Alberta
Alberta taxpayers should know how much their municipal governments spend

From the Fraser Institute
By Tegan Hill and Austin Thompson
Next week, voters across Alberta will go to the polls to elect their local governments. Of course, while the issues vary depending on the city, town or district, all municipal governments spend taxpayer money.
And according to a recent study, Grande Prairie County and Red Deer County were among Alberta’s highest-spending municipalities (on a per-person basis) in 2023 (the latest year of comparable data). Kara Westerlund, president of the Rural Municipalities of Alberta, said that’s no surprise—arguing that it’s expensive to serve a small number of residents spread over large areas.
That challenge is real. In rural areas, fewer people share the cost of roads, parks and emergency services. But high spending isn’t inevitable. Some rural municipalities managed to spend far less, demonstrating that local choices about what services to provide, and how to deliver them, matter.
Consider the contrast in spending levels among rural counties. In 2023, Grande Prairie County and Red Deer County spent $5,413 and $4,619 per person, respectively. Foothills County, by comparison, spent just $2,570 per person. All three counties have relatively low population densities (fewer than seven residents per square kilometre) yet their per-person spending varies widely. (In case you’re wondering, Calgary spent $3,144 and Edmonton spent $3,241.)
Some of that variation reflects differences in the cost of similar services. For example, all three counties provide fire protection but in 2023 this service cost $56.95 per person in Grande Prairie County, $38.51 in Red Deer County and $10.32 in Foothills County. Other spending differences reflect not just how much is spent, but whether a service is offered at all. For instance, in 2023 Grande Prairie County recorded $46,283 in daycare spending, while Red Deer County and Foothills County had none.
Put simply, population density alone simply doesn’t explain why some municipalities spend more than others. Much depends on the choices municipal governments make and how efficiently they deliver services.
Westerlund also dismissed comparisons showing that some counties spend more per person than nearby towns and cities, calling them “apples to oranges.” It’s true that rural municipalities and cities differ—but that doesn’t make comparisons meaningless. After all, whether apples are a good deal depends on the price of other fruit, and a savvy shopper might switch to oranges if they offer better value. In the same way, comparing municipal spending—across all types of communities—helps Albertans judge whether they get good value for their tax dollars.
Every municipality offers a different mix of services and those choices come with different price tags. Consider three nearby municipalities: in 2023, Rockyview County spent $3,419 per person, Calgary spent $3,144 and Airdrie spent $2,187. These differences reflect real trade-offs in the scope, quality and cost of local services. Albertans should decide for themselves which mix of local services best suits their needs—but they can’t do that without clear data on what those services actually cost.
A big municipal tax bill isn’t an inevitable consequence of rural living. How much gets spent in each Alberta municipality depends greatly on the choices made by the mayors, reeves and councillors Albertans will elect next week. And for Albertans to determine whether or not they get good value for their local tax dollars, they must know how much their municipality is spending.
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