Why Alberta Is Raising the Provincial Portion of Property Taxes

The increase many Alberta homeowners are seeing in the provincial portion of their property tax bills this year is largely tied to the rising cost of operating the province’s education system.
Each year, municipalities collect a portion of property taxes on behalf of the Government of Alberta through what is known as the education property tax, sometimes called the education requisition. While the tax appears on municipal property tax bills, the rate and total amount are set by the provincial government and the funds are used to support Alberta’s K-12 education system.
In its most recent budget, the province announced that education property tax rates would increase after being frozen the previous year. For the 2026 fiscal year, the residential and farmland rate will rise to $2.84 per $1,000 of equalized property assessment, while the rate for non-residential properties will reach $4.17 per $1,000 of assessment value.
The increase is expected to raise billions of dollars across the province. Provincial forecasts estimate education property tax revenue will grow from about $3.1 billion in 2025-26 to approximately $3.6 billion in 2026-27, helping cover roughly one-third of Alberta’s education operating costs.
According to the provincial government, the higher tax revenue is needed to support Alberta’s rapidly expanding school system. Alberta continues to experience some of the fastest population growth in Canada, leading to a surge in student enrolment across many school districts.
Budget 2026 includes hundreds of millions of dollars in additional funding for education to address those pressures. The province has allocated about $722 million in new funding aimed at accommodating enrolment growth, supporting teacher compensation, improving classroom conditions, and expanding school infrastructure.
The education property tax helps fund day-to-day school operations, including teacher salaries, classroom materials, and other instructional resources. The money collected is placed into the Alberta School Foundation Fund, which distributes funding to public and separate school boards across the province based on student numbers.
Provincial officials say increasing the education property tax helps ensure a stable funding source for schools while balancing the overall provincial budget. Historically, the tax has covered a portion of education operating costs, with the remainder funded through general provincial revenues such as income taxes and resource royalties.
The share of school operating costs funded through the property tax is also increasing slightly. In recent years, the education property tax funded about 28 per cent of operating costs, but that share is expected to rise to more than 31 per cent in the current fiscal year.
For municipalities, however, the increase can present challenges. Cities and towns are required to collect the tax and send it to the province, even though they do not control the rate. As a result, when the provincial requisition rises, it can increase the overall property tax bill residents receive while leaving municipalities with less flexibility in how local revenue is spent.
In many communities, the provincial education portion already makes up a significant share of the total property tax bill. In large Alberta cities, for example, the provincial portion can represent roughly one-third of a homeowner’s total property tax payment.
As population growth continues and more schools are needed, education funding is expected to remain a major factor in property tax discussions across the province. For homeowners in communities like Chestermere, the result is that even if municipal taxes remain relatively stable, the provincial portion of the property tax bill may continue to climb in the coming years.