Budget 2025: What It Means for Founders

The Bottom Line

Alberta's competitive advantages remain intact in Budget 2025: the 8% corporate income tax rate (lowest among major provinces), no provincial sales tax, and now a new personal income tax bracket that saves your team members up to $750 each. The Technology and Innovation budget grows to $834 million, and the Innovation Employment Grant continues to expand. But the macro picture is tougher: the province is running a $5.2 billion deficit, unemployment is climbing to 7.4%, U.S. tariffs are assumed at 15% on goods, and GDP growth is slowing to 1.8%.

Top Measures That Affect You

1. 8% corporate income tax rate maintained, the lowest among major Canadian provinces. Combined with no provincial sales tax, Alberta's tax structure remains the most founder-friendly in Canada.

2. New 8% personal income tax bracket on the first $60,000 of income, saving each of your employees up to $750 per year. If you are recruiting talent from Ontario, BC, or Quebec, this widens Alberta's after-tax advantage. Effective January 1, 2025, with payroll adjustments after July 1.

Innovation Employment Grant (IEG) growing, with $3 million more in 2025-26 and $12 million more over the following two years. The IEG supports R&D hiring in Alberta, making it cheaper to build your development team here.

$4 billion contingency (doubled from $2 billion) for economic uncertainty, including the effects of U.S. tariffs and collective bargaining. While this is a government reserve, it signals the province is taking the tariff threat seriously and has resources to respond.

Invest Alberta Corporation funded at $17 million per year for investor and business attraction. If you are looking for government introductions to international investors or customers, this is your gateway.

Investment and Growth Fund at $45 million over three years, supporting economic diversification and growth. This fund can support business expansion and attraction initiatives.

Alberta is Calling Moving Bonus increased by $11 million, helping attract workers from other provinces to Alberta, which directly benefits founders struggling to recruit.

Direct Financial Impact

Corporate taxes: At 8% provincially and 9% federally for small businesses (total 11% combined on the first $500,000), Alberta offers one of the lowest corporate tax burdens in North America. The budget makes no changes to corporate rates. The combined general rate (8% provincial + 15% federal = 23%) is also competitive for scale-ups beyond the small business deduction.

Personal income taxes for your team: Alberta already has the highest basic personal exemption among provinces. The new bracket means an employee earning $90,000 saves $750 compared to the old rate, and someone earning $50,000 saves roughly $500. This matters when competing for hires against Vancouver or Toronto.

Innovation Employment Grant: The IEG provides grants to companies based on eligible R&D expenditures in Alberta. If you are spending on product development, engineering, or applied research, this effectively reduces your cost of R&D by the grant amount.

Economic headwinds: GDP growth at 1.8%, unemployment at 7.4%, and CPI at 2.6% mean a slower economy. Consumer spending is softer. If your startup is B2B, enterprise spending may also be cautious. However, Alberta is expected to outperform other provinces due to energy sector resilience.

Exchange rate: The Canadian dollar at 69.6 US cents means your costs are lower for U.S. customers but imported supplies and services are more expensive. If you earn revenue in USD, this is a tailwind.

Tariff risk: The budget assumes 15% U.S. tariffs on all goods (10% on energy) with Canadian retaliation. If your business imports components or exports products across the border, this directly affects your margins and pricing.

Service Changes

Technology and Innovation ministry: Operating at $834 million, the ministry partners with innovators, entrepreneurs, and businesses. It funds research and emerging technologies and enhances government processes. The ministry is your primary interface with provincial innovation support.

Alberta Innovates: While the budget does not break out specific funding, the Technology and Innovation ministry shows operating expense declining by $53 million over two years after 2025-26, largely from Alberta Innovates reductions. If you use Alberta Innovates programs (grants, accelerators, mentorship), plan for potentially reduced availability.

Clean Hydrogen Centre of Excellence: $10 million over two years. If you are building in the hydrogen or clean energy technology space, this is relevant.

Broadband expansion: $48 million in capital grants for the Broadband Strategy, supporting connectivity infrastructure. This benefits founders building for customers in smaller Alberta communities.

Skilled workforce pipeline: $135 million per year for skilled trades, $113 million in post-secondary scholarships, and $528 million over three years in campus capital. The talent pipeline your company needs is being maintained.

Dow Path2Zero project: The budget notes this $11.6 billion project is ramping up construction, alongside other major industrial projects. These large projects create a supplier ecosystem and talent pool that can benefit tech companies serving industrial customers.

What's Missing

No angel investor or venture capital tax credit: Alberta does not offer tax credits for angel investors or venture capital investments, unlike several other provinces. The budget does not introduce one.

No startup-specific grant or accelerator funding increase: While the IEG grows modestly, there is no new flagship program targeted at early-stage companies, incubators, or accelerators.

Alberta Innovates on a declining trajectory: The projected decline in funding is concerning for founders who rely on Alberta Innovates as a first source of non-dilutive capital, mentorship, and market access support.

No international talent program: Despite the Alberta is Calling Moving Bonus, there is no province-specific program to attract international tech talent or streamline immigration for skilled workers.

No regulatory sandbox details: The budget mentions economic diversification broadly but does not announce regulatory sandboxes for fintech, health tech, or other emerging sectors where founders need regulatory flexibility.

No mention of AI strategy: Despite Alberta's AI research strength (including the Amii ecosystem), the budget does not detail a province-level AI strategy or dedicated funding for AI companies.

Key Dates

Date	What Happens
January 1, 2025	New 8% personal income tax bracket takes effect
April 1, 2025	New fiscal year; Technology and Innovation budget begins
After July 1, 2025	Employees see tax savings on paycheques
2025-26	IEG grows by $3M; apply through Technology and Innovation
2025-26	Tariff baseline assumed at 15% on goods, 10% on energy
2025-26 to 2027-28	$45M Investment and Growth Fund available
After 2025-26	Alberta Innovates funding projected to decline
By 2027	GDP growth expected to recover above 2%

Where to Get Help

Innovation Employment Grant: Visit alberta.ca/innovation-employment-grant for eligibility and application details.

Alberta Innovates: For grants, accelerators, and entrepreneurship programs, visit albertainnovates.ca.

Invest Alberta Corporation: For investment attraction, international market access, and business support, visit investalberta.ca.

Alberta Enterprise Corporation: For connections to Alberta's venture capital ecosystem.

Corporate and personal tax: Contact Alberta Treasury Board and Finance at 780-427-5364 (toll-free: 310-0000 then 780-427-5364).

Budget documents: Full details at alberta.ca/budget-documents.