Edmonton...The Alberta government will eliminate the Alberta Royalty Tax Credit Program (ARTC) as of January 1, 2007. The elimination of the ARTC based on 2005-06 figures would increase revenues from energy resources to the province by a further $111 million.

"This change better reflects today's climate, market and prices," said Energy Minister Greg Melchin. "Unprecedented investment, exploration and profits in the energy sector are just part of the picture. Our decision also factors in provincial corporate tax reductions and full tax deductions on royalties at the federal level. This program has run its course."

The decision follows a review and consultation with industry and stakeholders. It requires a legislative change that will be retroactive to the beginning of 2007.

The ARTC program was established in 1974 in response to that year's federal budget, which made royalties a non-deductible expense for federal income tax purposes. The program enabled oil and gas companies to receive a credit on their income tax. The credit was a percentage of a set amount of the crown royalties they paid in the year on wells that qualified for the program. Since 1974, the program has undergone minor adjustments to provide assistance in times of low prices.

In 2005-06 more than $14 billion in resource revenues were collected by the province. Last month, the government announced amendments to eliminate or substantially reduce four other royalty programs that could increase resource revenues by up to $186 million annually.

For more information on Alberta's royalty structure visit the Alberta Energy website at www.energy.gov.ab.ca.

- 30 -

Jerry Bellikka
Director
Communications
Alberta Energy
Tel: (780) 422-3667
Cell: (780) 237-5509

Alberta Government Home | Ministries Listing | Energy Home Page | News Releases | Top of Page |

Send us your comments or questions

Copyright(c); 2006 Government of Alberta