Canadians would be paying additional $1000 a year if it weren’t for Alberta’s contribution: report

The Canadian flag and an Alberta provincial flag fly together in Cochrane.

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Canadian income taxpayers would have to pay, on average, an additional $1,000 every year to maintain Ottawa’s current spending levels if it were not for Alberta’s contribution to federal finances, a new report by the Fraser Institute has found. 

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A study released Monday by the think tank says Alberta’s relatively high employment rates, higher average incomes, and younger population mean the province makes an outsized contribution, paying more to federal revenues and national programs than it receives in transfers and federal spending.

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From 2007-2008 to 2026-2027 Albertans’ net contribution is a projected $321.9 billion, according to the research — nearly four times British Columbia’s at $87.8 billion and more than five times Ontario’s at $59.6 billion.

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The other seven provinces were net recipients during that time period, which means they received more money back from Ottawa than the amount of revenue they sent.

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According to the study, Alberta’s large net contribution helps fund federal programs across the country and reduces the tax burden that would otherwise fall on taxpayers elsewhere. It concludes that maintaining federal spending levels without Albertans’ net fiscal contribution over the time period would require taxpayers in other provinces to pay an additional $1,007 per year on average.

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“Many Canadians don’t realize what a sizeable contribution Albertans make to federal finances and how taxpayers in other provinces benefit from it,” said Tegan Hill, director of Alberta policy at the Fraser Institute and co-author of the research.

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“As Canadian federalism increasingly takes centre stage in many of the country’s important policy discussions, it is important that all Canadians and policymakers understand the significant contribution Albertans make every year to federal finances and how Canadians in other provinces benefit from that.”

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Previous research from the Fraser Institute found that the combined federal and provincial net debt, adjusted for inflation, has nearly doubled from $1.24 trillion in 2007-08 to a projected $2.44 trillion this fiscal year, a growth of 97.7 per cent.

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Data from the past three decades showed Alberta had the largest net gain in migration from other provinces, gaining 538,824 more people than it lost. This was the largest net gain in the country, and more than double British Columbia’s at 214,883.

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The study didn’t investigate the reasons for the gains and losses across the provinces, but past research points to jobs, wages and taxes.

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And yet, despite its popularity, a recent Postmedia-Leger survey found that fewer than half of Albertans say they would stay in a newly independent province should it separate from Canada.

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Meanwhile, the latest opinion polls suggest the majority of Albertans wish to remain part of Canada, with a Leger survey from June 5 finding that 73 per cent of Albertans say the province should remain, and an Angus Reid poll from May 27 finding that three-in-five say they’d vote in October to stay.

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