Reversal of New Change to Alberta Charitable Donations Tax Credit

April 21, 2015

Alberta Finance Minister Robin Campbell delivered his first budget on March 26, 2015.  A surprising change included in the budget was a reduction in the charitable donations tax credit (CDTC) provided by Alberta to individuals for donations over $200 annually.

The current Alberta CDTC is 21%, resulting in a combined federal and Alberta tax credit of 50%.  The new change, as contemplated in the March 26 budget, would have meant that effective in 2016, the Alberta CDTC would have been reduced to 12.75%, resulting in a combined federal and Alberta tax credit of 41.75%.

The reduction in the charitable donations tax credit in the March 26 budget was perceived by many as unfortunate news for charities, particularly since the economy is experiencing challenging economic times, and attracting donations may be more difficult.

In response to the concerns and public outcry, on April 21, 2015, Government of Alberta Premier Jim Prentice announced at an election event that a new Progressive Conservative government would reverse the reduction of the donation tax credit that was part of the March 26 budget and return to the previous CDTC rate of 21%.

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