Budget 2025: What It Means for Trucking Companies

The Bottom Line

Budget 2025 is a mixed picture for Alberta's trucking industry. On the infrastructure side, the province is investing $8,475 million over three years in Transportation and Economic Corridors capital, including $2.5 billion for provincial highways, bridges, and road safety improvements. On the demand side, U.S. tariffs of 15% on goods and 10% on energy, combined with an economic slowdown to 1.8% GDP growth, will weigh on freight volumes and your revenue. The personal income tax cut saves your drivers and owner-operators up to $750 each.

Top Measures That Affect You

1. $2.5 Billion for Roads and Bridges

The Capital Plan allocates $2.5 billion over three years for provincial highways, bridges, and road safety improvements. This is the core infrastructure that your trucks depend on daily. Better roads mean lower vehicle maintenance costs, fewer delays, and improved safety for your drivers.

2. Transportation and Economic Corridors Capital: $8,475 Million

The full three-year capital allocation for Transportation and Economic Corridors is $8,475 million, making it the single largest capital spending item in the entire budget. This includes highways, bridges, trade corridor improvements, and municipal transportation support.

3. Trade Corridor Expansion

Budget 2025 includes specific highway projects designed to expand trade corridors. Projects include highway twinning and paving that connect Alberta's northeast and northwest regions, such as Highway 686 paving between Peerless Lake and Trout Lake and Highway 63 twinning north of Fort McMurray. Highway 40 twinning south of Grande Prairie and grade widening between Grande Cache and Hinton also receive funding. These improvements benefit long-haul freight operations across the province.

4. Municipal Transportation: $3.3 Billion

Another $3.3 billion is allocated for municipal transportation projects, including approximately $2.9 billion for light rail transit projects in Edmonton and Calgary. While LRT primarily benefits transit, reduced urban congestion from improved transit infrastructure helps your trucks move through cities more efficiently.

5. U.S. Tariffs Reduce Cross-Border Freight

The budget assumes 15% tariffs on all Canadian goods exported to the U.S. (except energy at 10%) with Canadian retaliation on consumer goods. Manufacturing exports to the U.S. totalled approximately $32 billion in 2024 from Alberta alone. Reduced trade volumes mean fewer loads crossing the border, directly affecting your revenue if you run cross-border routes.

6. Personal Income Tax Cut for Drivers

The new 8% personal income tax bracket on the first $60,000 of income saves your employees and owner-operators up to $750 each per year. This helps with recruitment and retention in a competitive labour market where the unemployment rate is forecast at 7.4%.

7. Border Interdiction Patrol Team

Budget 2025 funds a new border interdiction Patrol Team within the Alberta Sheriffs. While primarily aimed at border security, increased enforcement activity at border crossings could add inspection time for your cross-border shipments.

Direct Financial Impact

Corporate tax environment: Alberta maintains its 8% corporate income tax rate for small businesses, with no provincial sales tax. Corporate income tax revenue province-wide is forecast at $6,764 million, down 8% from the prior year, reflecting the economic slowdown that will also affect your freight revenues.

Personal tax savings for drivers: Each of your drivers earning at least $60,000 saves up to $750 per year from the new 8% bracket. Drivers earning less than $60,000 see their personal income taxes fall by approximately 20%. This effectively puts more money in their pockets without you increasing wages.

Fuel costs: The budget assumes CPI inflation of 2.6%, with energy inflation expected to remain subdued due to softer oil prices. Lower diesel costs would be positive for your margins. However, Canadian retaliatory tariffs on imported goods could increase costs for truck parts and equipment.

Economic outlook: Real GDP growth slows to 1.8% in 2025 from 3.0% in 2024. The unemployment rate is forecast to rise to 7.4%. This overall economic deceleration means reduced freight demand across most sectors. The Fiscal Plan notes that manufacturing and agriculture will bear disproportionate tariff impacts, and these are major freight-generating sectors.

Exchange rate: The Canadian dollar is forecast to average 69.6 US cents, weaker than the prior year's 71.7 cents. For cross-border carriers, this makes Canadian trucking services cheaper in U.S. dollar terms, potentially offsetting some tariff-related demand loss.

Service Changes

Highway maintenance: Operating expense for Transportation and Economic Corridors is $580 million in 2025-26. This covers day-to-day road maintenance, winter operations, and safety improvements that affect your route quality.

Strategic Transportation Infrastructure Program (STIP): Funding continues for this program, which helps municipalities improve local transportation infrastructure that your trucks use for first-mile and last-mile deliveries.

Local Government Fiscal Framework (LGFF): Budget 2025 allocates $2.5 billion to the LGFF, an increase of $138 million from Budget 2024. Municipalities use a portion of this for local road maintenance and infrastructure that supports freight movement.

Digital government services: Service Alberta and Red Tape Reduction receives $180 million in operating expense, continuing efforts to streamline permits, licences, and regulatory compliance for commercial carriers.

What's Missing

No fuel tax relief: Despite tariff-related cost pressures, the budget does not include any fuel tax reductions or rebates for commercial carriers.

No targeted trade disruption support: While the $4 billion contingency includes flexibility for emerging tariff impacts, there is no specific program to support trucking companies losing cross-border freight volumes.

No commercial vehicle infrastructure: The budget does not announce new rest stops, truck parking facilities, or weigh station improvements.

No driver training incentives: With an aging workforce and rising unemployment, the budget does not include specific incentives for commercial driver training or apprenticeship programs in the trucking sector.

No electric truck transition support: The budget does not include incentives or infrastructure planning for the transition to zero-emission heavy vehicles.

Key Dates

Date	Event
January 1, 2025	New 8% personal income tax bracket takes effect
February 27, 2025	Budget 2025 tabled
April 1, 2025	2025-26 fiscal year begins
After July 1, 2025	Adjusted payroll withholdings reflect tax cut on paycheques
2025-26	Highway construction season begins (spring)
2025-28	$2.5B in highway and bridge projects rolled out
2025-28	Trade corridor expansion projects proceed
Ongoing	U.S. tariff situation evolving; $4B contingency available

Where to Get Help

• Alberta Transportation and Economic Corridors: For highway conditions, construction schedules, and permit information. Call 310-0000 then 780-427-2731.
• Alberta Motor Transport Association (AMTA): For industry updates and advocacy on budget impacts.
• Alberta Treasury Board and Finance: For details on the personal income tax cut. Visit alberta.ca/budget.
• Canada Border Services Agency: For updates on cross-border trade procedures affected by tariffs.
• Your MLA: Contact your local Member of the Legislative Assembly with concerns about highway conditions or trade impacts on your business.