A set of measures aimed at giving Albertan businesses and individuals some financial relief in the COVID-19 pandemic was announced by the Government of Alberta March 23.
Premier Jason Kenney said in a statement, “Our priority is to keep our province strong while we get through these difficult times together. We’re doing everything we can to support Albertans and Alberta employers through this crisis. That’s why we’re focused on creating tangible savings for households and freeing up necessary cash for businesses to help them through these unprecedented times.”
Education property tax increase freeze
The province has put a freeze on the planned increase in the provincial education property tax for both individuals and businesses.
The government said in a press release, “Reversing the 3.4 per cent population and inflation adjustment will save Alberta households and businesses about $87 million in 2020-21, which means $55 million for households and $32 million for employers.”
Effective immediately, the government will also defer education property tax for businesses for six months. The government said that this will save Albertan businesses $458 million over the next six months “to help them pay employees and continue operations.”
The provinces said it expects municipalities to set education property tax rates as they normally would, but defer collection. It added, “Deferred amounts will be repaid in future tax years.”
The release continued, “The government encourages commercial landlords to pass on these savings to their tenants through reduced or deferred payments. This will help employers continue to manage their debts, pay their employees and stay in business. Businesses capable of paying their taxes in full are strongly encouraged to do so. This will assist the province in being able to support Albertans through this pandemic.”
Travis Toews, president of the Treasury Board and Minister of Finance, said, “Eliminating the scheduled adjustment of education property taxes and deferring collection of non-residential property taxes will result in savings to Albertans and improved business cash flow. This measure will help Alberta households and businesses during this time – we want to keep Albertans working while we get through these difficult times together.”
Workers’ Compensation Board premium deferrals
Alberta is offering private sector employers the chance to defer WCB premiums until early 2021. Employers who have already paid their 2020 WCB premium are eligible for a rebate or credit.
The release added, “For small and medium businesses, the government will cover 50 per cent of the premium when it is due. Large employers will also receive a break by having their 2020 WCB premium payments deferred until 2021, at which time their premiums will be due.”
Paying 50 per cent of small and medium-sized businesses’ WCB premiums for 2020 will cost government approximately $350 million, said the province.
Other previously announced measures
The province also reiterated previously announced relief measures, including:
• deferral of the collection of corporate income tax balances and instalment payments until August 31, 2020;
• $50 million to support working Albertans who must self-isolate, including those who are the sole caregiver for a dependent who must self-isolate, and who will not have another source of pay or compensation;
• utility bill payment deferral for residential, farm, and small commercial customers for the next 90 days;
• a six-month, interest-free moratorium on Alberta student loan payments.
Cities feeling the 'cash crunch'
Edmonton Mayor Don Iveson, who announced on Twitter he is self-isolating with mild symptoms, said the province’s move on property taxes was a good step, but not enough.
He said in a statement, “The provincial government’s announcement on reduction of the Education Property Tax and deferral of its portion of the property tax for non-residential taxpayers is a helpful gesture, and non-residential property tax payers will appreciate the deferral of that portion of their taxes. However, this naturally raises a question about the City’s portion of their tax bill and whether they can expect the same relief.
“The relief measures we’ve provided on utility bills, the two-month delay on collection of property taxes, and all the extra costs of delivering service while responding to the COVID-19 crisis are squeezing the city’s reserves and putting us in a cash crunch as it is… Edmonton specifically wants to offer the option to defer all property taxes to both residential and non-residential taxpayers. However, in order to do this, we would need a substantial commitment from the provincial and/or federal government that they would provide a cash backstop or other measures that makes this relief financially possible for municipalities.”