Calgary’s business community is bracing for a steep rise in property taxes as the provincial government recently unveiled its budget, which includes a notable increase in the education property tax requisition. This adjustment is projected to yield an impressive $3.6 billion across Alberta by 2026, with Calgary’s share set at a staggering $1.2 billion—a $200 million climb from the previous year. For local businesses, particularly those operating non-residential properties, this means an expected additional financial burden of approximately £1,816. Coupled with a 1.6 per cent tax rise from the city council, businesses could see their total property tax bills swell by nearly £3,000 in 2026.
Local Businesses Voice Concerns
Arlen Smith, operating partner of the Palomino Smokehouse in downtown Calgary, expressed deep apprehension regarding these impending increases. “It’s terrifying with the cost of everything else right now,” he remarked. Smith, who typically plans for annual tax rises, is determined to keep prices stable, fearing that higher costs could alienate customers. “We have to at least break even. We can’t run a deficit. I’d love to be able to run a £9 billion deficit, but that’s not in the cards for us,” he added, highlighting the precarious balance many businesses must maintain amid rising expenses.
The Palomino also served as the venue for a press conference held by Alberta’s Opposition NDP, where leader Naheed Nenshi condemned the budget for making life more expensive for residents and business owners alike. “This budget makes life more expensive,” Nenshi asserted, emphasising the financial strain placed on everyday Calgarians. He criticized the provincial administration for what he described as a mismanagement of resources, particularly given the budget’s projection of a £9.4 billion deficit.
Comparison with Edmonton
The impact of the education property tax increase is not uniform across Alberta. In contrast to Calgary’s steep £1.2 billion requisition for 2026, Edmonton’s education property tax is projected at £639 million. For non-residential properties in Edmonton, the education tax is anticipated to add £11 per £100,000 in assessed value, followed by a 6.9 per cent city council tax increase, which translates to an additional £164 per £100,000. Nenshi pointed out that the provincial government appears to be deflecting blame onto local leaders for the tax rises, while the mayor of Edmonton is reportedly taking steps to ensure residents understand the source of these financial burdens.
Government’s Justification
In defence of the budget, Premier Danielle Smith argued that the province’s commitment to funding a third of the education operating budget through property taxes is essential for addressing the growth pressures experienced by Calgary. “We heard from ratepayers in Calgary that they wanted us to keep up with growth,” she stated, acknowledging that much of the strain on the education system stems from the city’s rapid expansion.
Smith also noted that to expect taxpayers in Calgary to cover all education operating costs would be “unaffordable.” She highlighted that the two major school boards in Calgary will receive £2.24 billion for operations in the upcoming school year. The Premier expressed optimism for the future, suggesting that discussions regarding these changes would continue.
Meanwhile, the Canadian Federation of Independent Business (CFIB) has raised alarms over the additional pressures the provincial budget places on local businesses due to the education property tax hike. Keyli Loeppky, the CFIB’s Alberta director, advocated for the creation of a new property subclass specifically for small businesses to alleviate some of the financial strain. “You could tax small businesses at a lower rate and provide some relief that way,” she proposed, aiming to offer a viable solution to the escalating costs.
Calgary’s city council is expected to finalise property taxes in the spring, with property bills scheduled to be sent out in May.
Why it Matters
The substantial hike in property taxes represents a critical challenge for Calgary’s business sector, which is still recovering from the economic fallout of recent years. As companies grapple with rising operational costs, the potential for increased taxation could stifle growth and innovation, forcing many to reconsider their pricing strategies and operational viability. This budget not only highlights the ongoing financial pressures faced by local businesses but also underscores the need for dialogue between government officials and the business community to ensure sustainable economic growth and stability in Calgary.
