Alberta’s ‘focused on what matters’ in Budget 2026

When tabling Alberta’s 2026 budget, Finance Minister Nate Horner said the government is “choosing to take the hit on our books … rather than put that strain on Alberta’s households.” He pointed to rapid population growth, global volatility, and the usual Alberta problem: revenue that can fluctuate rapidly based on the price of oil.

Budget 2026 pushes the province much deeper into deficit than last year, increasing to $9.4 billion, with the government signaling it will review its own fiscal framework because the current “return to balance” rules do not line up with the size and persistence of the projected shortfalls.

Here’s what you need to know:

• $83.9 billion in total spending.
• $74.6 billion in total revenue.
• $9.4 billion deficit in 2026-27
• $2.0 billion contingency in 2026–27
• $28.3 billion allocated over the next 3 years for the Capital Plan

Highlights

The fiscal story – bigger deficits, longer runway: Budget 2026 is a deficit plan because service costs are rising faster than revenue and the fiscal plan is built on a conservative oil outlook. The province assumes WTI at US$60.50/bbl in 2026–27 (after US$61.50 in 2025–26), recovering to US$67.00 and US$67.50 over the next two years. With that backdrop, the government forecasts three straight deficits and says it will look at “additional measures” alongside program reviews to get the books back toward balance.

Health care: Health care is the biggest line item in Budget 2026, with $34.4 billion in total expense in 2026–27, projected to climb to $36.2 billion by 2028–29. The plan includes $1.9 billion in new health funding aimed at reducing wait times and improving patient flow, including moving patients out of hospital sooner and strengthening access to care.

Targeted investments include $223 million over three years to expand Cancer Care Alberta’s workforce and clinical capacity, and $91 million over three years to increase emergency department and operating room capacity.

Education: At $10.8 billion, education is a big winner in the budget. This funding includes linking new education spending to enrolment growth, teacher compensation, and classroom conditions. This figure also covers the new collective agreement for teachers and hiring 3,000 more teachers,1,500 more educational assistants and classroom resources to address rising class sizes.

Capital: The three-year capital plan is forecast at $28.3 billion – a $2.2 billion increase from the last budget. The plan is framed as building communities and maintaining key public infrastructure that supports families and businesses. The biggest allocations include $7.1 billion for municipal infrastructure, $4.9 billion for health system capacity, $3.3 billion for new and ongoing school projects, $2.7 billion for provincial highways, bridges and road improvements and $4.2 billion for capital maintenance and renewal.

New revenue sources: Budget 2026 includes moves to help backfill the deficit without calling it a tax plan.

• Vehicle rental tax: A six per cent tax on vehicle rentals takes effect January 1, 2027, projected to generate $36 million in its first full year.
• Tourism levy: Effective April 1, 2026, the tourism levy rises from four to six per cent, generating an additional $66 million in 2026-27.
• Alberta Caregiver Credit: The new credit offers a maximum of $13,180 in 2026 (up to $1,054 in tax savings), estimated to reduce tax expenditures by roughly $12 million in its first full year.
• Education property tax: Residential rates rise from $2.72 to $2.84 per $1,000 of assessment; non-residential from $4.00 to $4.17. The requisition is projected to grow from $3.1 billion to $3.6 billion in 2026-27.

Economic outlook: The economic outlook assumes Alberta’s economy grows more slowly in 2026 than last year, with real GDP forecast to rise 1.8% (down from 2.2% in 2025), with ongoing trade uncertainty and slower population growth expected to dampen activity. Population growth is forecast to fall sharply to 1.1% in 2026 and remain at 1.1% in 2027 before gradually strengthening.  Oil assumptions have a big impact, as usual. The province assumes WTI averages US$60.50/bbl in 2026–27, down from US$61.50/bbl in 2025–26, with recovery assumed later in the forecast.

Upcoming dates of note:

• May 14 – Spring sitting ends
• July 3-12 – Calgary Stampede
• October 19 – Referendums; Immigration and Constitutional Amendments
• October 27 – Fall sitting begins
• December 3 – Fall sitting ends