A freshly harvested field outside of Medicine Hat awaits it's next crop.--NEWS FILE PHOTO
jtubb@medicinehatnews.com@ReporterTubb
The Alberta government is introducing a tax credit program to support growth and attract investment in the agriculture sector.
Minister of Agriculture and Irrigation Nate Horner announced Tuesday the Alberta Agri-Processing Investment Tax Credit, which he says will provide a 12 per cent non-refundable tax credit to support this growth and attract investment. To be eligible, corporations must make a minimum capital investment of $10 million in value-added agri-processing in Alberta.
Speaking in a roundtable format with reporters Wednesday, Horner said the new tax credit will build on the advantages they already offer.
“We have a skilled workforce, some of the lowest combined tax rates in all North America and hopefully we will attract even more investment to this already growing sector,” Horner said. “This will benefit our primary agriculture producers and this will expand market opportunities. This will strengthen local markets and it will add stability to food supply chains by increasing capacity within our own province.”
The tax credit program begins this spring and provides accepted companies a 10-year window to use the credit. Horner said it can’t be used entirely in the first year, being capped at 20 per cent usage in the first year, 30 per cent in the second, 50 per cent in the third and then any remaining balance can be utilized over the next seven years.
Horner said this program has been in the works since he was named agriculture minister in November 2021. He also said efforts were made to ensure it was ready for this time of the year, when those in the agriculture business are making decisions on the season ahead and their future.
“We have a lot of companies that are at that time of the year where they need to make some hard decisions about capital deployment,” Horner said. “We knew we needed to get this out at least, even though it won’t be actionable until after the legislation passes in the short spring session. We need to get this news out there just so we can start having some conversations because time is of the essence in a certain way.”
Horner also says the program will have an immediate eight per cent return on investment to Alberta taxpayers, across all jurisdictions.
“They’re going to be building these businesses and facilities in your communities, they’re going to be hiring people not only in the construction phase but also in the entire operational phase, which I said could in some cases last 40 or 50 years,” Horner said. “But more generally speaking at a higher level, this means that we’re not putting raw commodities in train cars and shipping it away. It takes it to the next step, it adds value, there’s packaging and it actually creates different products, which then … can be exported to open new markets, but definitely open opportunities.”
Premier Danielle Smith was not on the roundtable but included a statement in the initial press release.
“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. Alberta’s agricultural producers play an important role in feeding the world and I look forward to seeing further innovation and growth in this sector.”
