LAKELAND – Last week, the province announced it will launch a new agri-processing tax credit this spring to help attract large-scale investment to the province. The Alberta Agri-Processing Investment Tax Credit will be introduced as part of the province’s Budget 2023.
During a media roundtable on Feb. 8, Minister of Agriculture and Irrigation Nate Horner said the program will provide 12 per cent “non-refundable tax-credit" to eligible businesses that will make a minimum capital investment of $10 million “in value-added agri-processing" in the province.
He explained, “the way this works and the non-refundable credit – we're not writing a cheque.” Horner said there is no grant writing involved, and “this is provincial corporate tax forgiveness on the back end.”
According to Horner, the 12 per cent non-refundable tax-credit was set as “we believe this will allow us to attract about 35 per cent incremental investment,” and eight per cent immediate return on investment for Alberta taxpayers.
“The program will build on our already substantial competitive advantages” in the agri-processing industry, said Horner.
The minister stated the tax credit will benefit the province’s primary agriculture producers, expand market opportunities, strengthen local markets, and will “add stability to food supply chains by increasing capacity within our own province.”
When asked how these benefits will be realized, Horner said when agri-processing businesses and facilities are built in communities, “they’re going to be hiring people not only in the construction phrase, but also the entire operational phase,” which includes building facilities that may last for over 40 years.
By enhancing agri-processing in the province, Horner also said, “this means we’re not putting raw commodities in train cars and shipping it away.”
“It takes it to the next step,” he said. “There’s packaging and it actually creates different products” that can then be exported to new markets and open opportunities.
Horner also said he hopes the program will send a clear message to investors that “Alberta is open for business and this is a sector that we really want to see reach its full potential.”
“When we process what we grow here in Alberta, the jobs and economic benefits stay in Alberta. So, we're proud to deliver this win for the sector, and we look forward to seeing all the investment that it will bring in,” said Horner.
Among the supporters of the program include Pal McLauchlin, president of the Rural Municipalities of Alberta (RMA). In a Feb. 7 provincial media release, McLauchlin said that food security will be a growing challenge considering the changing climate and increased costs of food.
“The new agri-processing tax credit program is a great incentive that will continue to highlight rural Alberta as the home of an innovative agriculture industry that plays a vital role in supporting food production,” said McLauchlin.
