The Government of Alberta’s 2025 Budget is set to deliver increases for Calgarians, with funding for Calgary projects, municipal funding, and also an increase to the education portion of the property tax.

The average Calgary homeowner can expect to see their educational component of their property tax bill rise by $239 per year, as the tax taken from Calgary homeowners is set to increase from $882 million in 2024 to $1.037 billion in 2025, making up a third of the expected $3.124 billion in education property tax revenue.

But the average Albertan will see a decrease in their income taxes if the budget is approved, as the provincial government introduces a long promised cut to income tax rates.

The province will introduce a new 8 per cent tax bracket for those individuals making $60,000 and under—which the government said will save individuals making up to that amount a maximum of $750 per year.

Minister of Finance Nate Horner said that on balance the income tax cut would be substantively larger than any other property tax or fee increases introduced in Budget 2025.

“I think it’ll be dramatically different scales. The income tax cut is substantial for individuals and for families,” he said.

Horner said the increase in property taxes was a result of the higher valuation of Calgary properties versus elsewhere in the province, as well as an aim by the government to increase funding for education as a proportion of the budget from 28 per cent to 33 per cent.

The reduction to the government’s finances as a result of the income tax cut was expected to be $1.2 billion, made up by increased taxpayer supported debt over the next three years to cover an expected $6.6 billion shortfall in revenue overall.

That shortfall in revenue overall was a reality of uncertain economic times and the looming threats of tariffs, said Minister Horner.

“The evolving situation with Canada-US trade relations is bringing even more uncertainties to the provinces revenue forecast, and this is reflected in the forecast for oil prices,” Horner said.

Horner said the introduction of the income tax cut was a way of providing more economic certainty to individual Albertans—two years ahead of schedule. He said normally he would have pushed for a balanced budget, and under different circumstances where the threat of tariffs did not exist, it would have been more difficult to approve the personal tax cut in Budget 2025.

Meaghon Reid, Executive Director for Vibrant Communities Calgary, expressed concern that the maximum of $750 in personal income tax cuts—although appreciated—would not necessarily help Calgarians equally.

“$60,000 is positive from an affordability perspective, if you are in that range, and so we would congratulate the government for putting that in as that will make a difference to a lot of people. However, I do worry that a lot of the budget, including this announcement around the $60,000 threshold, doesn’t necessarily look at the people in our city or province that are making far below that number,” Reid said.

“That is absolutely the case for people who are on income support, for example. So I think there’s some great affordability measures for people in the lower middle class brackets. I think that we might have missed the mark in terms of concrete funding for people who are most vulnerable in the province.”

Alberta NDP’s Shadow Minister of Finance, Court Ellingson, disputed the timing of the personal income tax cut, saying that it amounted to at most $2 a day for Albertans that would in turn be eaten up by tax and fee increases elsewhere in the budget.

“At the same time, they’re increasing property taxes at a rate that we, I don’t think, that we’ve seen in recent memory. Property taxes are just the start. We already know that Albertans are going to pay seven and a half percent more on auto insurance this year,” Ellingson said.

“There were 38 areas in the budget where Albertans are potentially paying more in licensing and fees through this budget. So this budget isn’t delivering for Albertans.”

Mayor Gondek responds to Budget 2025

Minister Horner said that the decision to introduce the personal income tax cut was not without some trepidation, but that now was the right time to support individual Albertans.

“Balanced budgets mean a lot to me. I don’t want to put a Alberta in a position long term, where this task I’m going to take to provide a pass back is even harder. But due to the uncertainty, due to the affordability concerns that we’re seeing, it seemed like the right time, and I fully endorse it,” he said.

Mayor Jyoti Gondek thanked the Government of Alberta for the budget, saying that while there was not a lot of time to examine the details of the budget, they remained cautiously optimistic about the theme of growth and addressing challenges.

That sentiment was echoed by Brad Parry, CEO of Calgary Economic Development, who said that the movement towards diversifying the economy in the budget was appreciated.

“We have built up incredible momentum for Calgary’s economy and we need to double down on diversification to keep that momentum going. This means supporting innovation and diversifying our economy by remaining focused on our key sectors. It also means diversifying our trade markets internationally, as well as within Canada,” Parry said in a prepared statement.

“It is encouraging that the Government of Alberta remains focused on the Alberta Technology and Innovation Strategy and Alberta Export Expansion Program, and we hope to see continued support for economic development activities, workforce strategies and innovation in the coming years.”

That optimism was hedged by Mayor Gondek though, with a concern over the lack of details in Budget 2025 itself, along with even less specifics about how the budget would affect Calgary.

“We’re the fastest growing city in this nation, and there really wasn’t a nod to that,” she said.

Mayor Gondek brought up the differences in calculations between what the province projected the education property tax increase to be, versus the provincial estimate, saying that the City of Calgary had calculated the change to be about $9 per month versus close to $20 from the province.

She said that estimate was based on the limited amount of information that had been provided to the City of Calgary by the province on budget day.

“That’s why we need to dig into these numbers a little bit deeper. It’s fairly disappointing that the lock up and embargo session was so incredibly brief, we couldn’t ask these questions,” the mayor said.

Whether that increase for Calgarians in property taxes, which was proportionally higher than for Edmontonians and other Albertans was fair, the mayor said that there has been a situation where the money that Calgarians have paid into provincial coffers has not been accounted for.

“The fact of the matter is, a big chunk, more than 30 per cent is going up to the province. For many, many years, they were not accountable for explaining where that money was going,” Mayor Gondek said.

“We are not getting back what we are contributing. That money is being distributed to other municipalities. I guess you could call it equalization, and it is not fair to our city. It is not fair to the taxpayers of this city.”

Money for Calgary

A number of Budget 2025 line items in the province’s capital plan set forth increases for the City of Calgary.

The City of Calgary was set to see an increase in both provincial grants in lieu of property taxes that would otherwise be paid by the Government of Alberta, and through the Local Government Fiscal Framework.

The Government of Alberta is increasing the amount of grant funding they would otherwise pay in property taxes from 50 per cent to 75 per cent, resulting in $19 million in increased grants for municipalities across the province.

That portion of grants is expected to heavily favour Edmonton, which has more provincially-owned building inventory, but Calgary is expected to increase its share by $2.6 million to $7.8 million based on the assessment of Crown properties.

The Local Government Fiscal Framework is also set to rise to $820 million, up from $724 million in 2024, with Calgary receiving 31 per cent of that amount at $255 million.

That increase was a result of increased revenues as part of the revenue sharing agreement that has made up the LGFF, Minister Horner said.

Mayor Gondek said that she wouldn’t reject the $2.6 million increase from grant funding, nor the increase from the LGFF, but that the overall funding remained below what municipalities across the province have asked for.

“The LGFF has been vastly underfunded, and we have pointed that out. As a city, as Alberta municipalities, our advocacy group has pointed out the same thing,” she said.

“I’m very happy to see that there’s an increase to that funding. It will help us get infrastructure projects done, but that whole fund is still sorely underfunded, and so until it keeps pace with growth and inflation.”

Ellingson said that the increase in funding for the LGFF below what municipalities have asked for, when in consideration for the downloaded costs from the province on to municipalities, meant that the province needed to reconsider its relationship to municipalities like Calgary.

“[The government] needs to think about the long term commitment that we have with municipalities as partners in delivering services to citizens. Municipalities have one primary source of revenue, and that’s property tax. If the government and the properties that they own are not going to step up and meet what otherwise they would pay in property tax… that’s just not fair.”

Green Line funding remains low despite large price tag for project

Green Line funding is also expected to continue to be provided by both the provincial and federal governments, although at far lower amounts than the $6.25 billion price tag associated with the project. The province will be providing $100 million in Budget 2025, while the federal government will be providing $40 million.

“There was Green Line funding existing in the budget that is ongoing, and I haven’t seen any new ask come to Treasury Board for any new arrangement,” said Minister Horner.

The province has also indicated that it intends to fund planning expansion of Calgary’s Blue Line to the Calgary Airport, at $6 million.

Investments into low-income passes for Calgarians will remain stable at $6.2 million, which represented the entire topped up fund value provided in 2024 for the city.

Mayor Gondek said that she was thankful that amount wasn’t cut from the budget, but said that demand was increasing for low income passes.

“We know that people are struggling with affordability. We also know that about 275 people a day are moving to our city, and a proportion of those folks will need to access the low-income transit pass,” she said.

“So, council will be in a difficult position again, where we are going to have to determine how much we need to contribute, because the contribution from the provincial government—although I’m grateful to get it—has remained static. Yet the need for this transit pass has grown.”

Reid said that she was happy that the province chose to continue funding what they had initially described as a pilot program.

“I think it will be a challenge for the city to keep up with the requested numbers of low income transit passes, but this is a very different place than it would have been if this funding was entirely cut. I think that would have meant the death of the pass,” she said.

“I’m glad to see that maintained investments, because the ministry has signalled it was a pilot project and that they would be winding down their funding.”

Other major investments into Calgary specific capital projects included $197 million for Deerfoot Trail Upgrades, $40 million for Bridgeland Riverside Continuing Care, $136 million in investments for the Foothills, Calgary Cancer Centre, Peter Lougheed, and Rockyview Hospitals, which includes $6 million for a centralized drug production facility to serve AHS and Covenant Care facilities in Southern Alberta.

The long proposed but so-far not moved forward North Calgary/Airdrie Regional Health Centre remains at the planning stage with a $1 million capital investment that is not set to continue in future budgets.