Alberta announces tax credit to support agri-processing industry

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Alberta is introducing a new agri-processing tax credit that the government claims will maintain the province's competitive advantage, increase investment, and further diversify the economy.

Agriculture and Irrigation Minister Nate Horner said producers and processors have been urging the government to do more to help grow the agri-processing industry.

According to a government release, the Alberta Agri-Processing Investment Tax Credit will provide a 12% non-refundable tax credit to support growth within the ag industry.

The government said it would introduce the tax credit in this spring's budget.

Corporations must make a minimum capital investment of $10 million in value-added agri-processing in the province to be eligible for the credit.

Horner added that the credit would allow the province to attract large-scale agri-food projects that will help grow the industry, increase opportunities for primary producers, create jobs and feed the world.

"Agriculture has been a key part of Alberta's economy for more than 100 years, and I'm excited to see this tax credit program roll out so that it continues to be a key part of our economy in the future," said Alberta Premier Danielle Smith. 

"Alberta's agricultural producers play an important role in feeding the world. I look forward to seeing further innovation and growth in this sector."

But NDP Agriculture and Rural Economic Development Critic Heather Sweet clapped back at the new tax credit, claiming it fell short of similar credits provided by other provinces.

"For years, we have called on the UCP to restore our competitiveness and released our proposal to increase value-added processing and production, including an incentive program," said Sweet. "It's encouraging to see the UCP finally act on this." 

"However, today's announcement falls short of what the other prairie provinces provide for support and fails to address Alberta's regulatory burden."

Horner contends that the tax credit presents an enormous economic opportunity for Alberta, as the jobs and economic benefits stay in-province.

However, Sweet claimed that the province's agri-processing industry suffers a "competitive disadvantage" under the UCP. 

She added that an NDP government would implement a "value-add" incentive program that "attracts investment, builds a resilient economy, decreases approval times, and creates good-paying jobs."

According to provincial data, regional food manufacturing sales reached a record $20.1 billion in 2021, employing 22,400 Albertans.

The food manufacturing sector was the largest manufacturing industry in the province, accounting for 23.8% of total provincial manufacturing sales in 2021.

Horner also lauded Alberta as being "well-positioned" to meet the growing demand for food as the global population continues to increase.

By 2050, the global demand for food will increase by up to 56%.