Alberta Projects $5.2 Billion Deficit as U.S. Tariff Threat Looms

The province braces for economic uncertainty, with reduced oil revenues and a new tax cut compounding fiscal challenges.

Alberta's 2025 budget forecasts a $5.2 billion deficit, reversing a $5.8 billion surplus from the previous year, citing potential U.S. tariffs and declining oil revenues.
The budget assumes a scenario where U.S. tariffs on Canadian goods average 15%, with a 10% levy on energy exports, Alberta's most critical industry.
Premier Danielle Smith has emphasized diplomacy, lobbying U.S. policymakers to avoid tariffs while urging Canadian provinces to address U.S. concerns over border security and drug trafficking.
The province's contingency fund has been doubled to $4 billion to prepare for the economic impact of potential tariffs and other uncertainties.
A newly introduced tax cut for individuals earning over $60,000 is expected to reduce government revenue by $1.2 billion, saving taxpayers $750 annually but adding to fiscal pressures.