Alberta separation could mean 13% sales tax: report
Posted Sep 30, 2026 11:28 am.
A new report commissioned by the Calgary Chamber of Commerce warns that an independent Alberta could require a 13 per cent sales tax to maintain public services currently provided by the federal government.
The findings come from a more than 30-page analysis by University of Calgary economist Trevor Tombe, released as debate over Alberta sovereignty continues ahead of a referendum on Oct. 19.
According to the report, Alberta could face a $9-billion fiscal shortfall after separation. To compensate, the province would need to raise additional revenue while taking on responsibilities Ottawa currently handles.
“To account for the fact that the economy would be smaller, revenues from income taxes would be smaller, and costs would be higher, because we would have to increase spending in order just to execute the core functions of a now separate country,” said Tombe, the report’s author.
The chamber is also warning that losing access to Canada’s existing free trade agreements could increase trade costs by five to eight per cent. The report estimates that as many as 69,000 jobs could be lost in Calgary alone.
On Tuesday, the chamber released an open letter signed by business leaders urging Albertans to reject separation.
“Those who are sitting on the fence thinking they might need to send a message, we don’t need to send a message; that message has been sent and delivered,” said Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce. “We need to look forward and not look back.”
The latest analysis builds on earlier chamber research warning Alberta’s economy could shrink by $62 billion annually if the province left Canada.
“When you hear something like GDP contracting, it seems like an abstract statistical notion, but this translates directly to real income and wages,” Tombe said. “How much goods and services can you afford to purchase with an hour of work? And if you have lower productivity, then living standards fall, directly as a result.”
Supporters of Alberta independence dispute those conclusions, arguing a sovereign Alberta would be better positioned to negotiate trade agreements that benefit the province.
“Should Alberta’s ability to trade with the U.S. be held hostage to Quebec cheese curd sales?” said Jeffrey Rath, general counsel for Stay Free Alberta. “We’ve already met with the American State Department in Washington and what they were telling us is that they would be wide-open to a reciprocal free-trade agreement with Alberta the day after independence that would see zero tariffs on Alberta goods and services on both sides of the border.”
Keith Wilson, constitutional lawyer and co-lead of Let Alberta Decide, said Alberta could also gain leverage by controlling key transportation and trade corridors.
“We can take advantage of our natural advantages,” Wilson said. “The fact that British Columbia is continentally landlocked. $55 billion worth of goods in their economy has to travel east on our roads and rail lines each year to reach markets. Those are leverage points under the current structure of Canada’s constitution and division of powers; we can’t use those levers right now.”
Albertans are expected to vote on the separation question on Oct. 19.
