Alberta Finance Minister Joe Ceci recently told a business audience that Alberta has the “lowest taxes overall of any province or territory” in Canada. A year ago, this was unambiguously true. At that time, Alberta had the lowest overall tax burden in the country and also had by far the lowest rates on key taxes that greatly affect economic growth and competitiveness.

Now, Alberta’s once vaunted tax advantage over other Canadian provinces is no longer what it used to be, and certain key elements of the tax advantage have been erased completely because the provincial government has enacted a suite of tax increases.

When it comes to tax competitiveness, the overall tax burden imposed by a government is of course important. But the composition of the tax mix is also important, since certain taxes—such as personal income and corporate taxes—do more harm to the economy than others by discouraging work and investment. On this score, Alberta has taken major steps backwards in the past year, increasing some of its most economically harmful taxes and thereby frittering away crucial components of Alberta’s tax advantage.

Let’s start with income taxes. Up until the end of last September, Alberta had a single 10 per cent personal income tax rate. Contrary to claims made by the finance minister, the system was progressive due to the high basic personal amount, and the low marginal rates didn’t unduly distort incentives for productive economic activity.

The new five-bracket income tax system increased Alberta’s top marginal income tax rate by 50 per cent, which ties Alberta with Saskatchewan at 15 per cent, and is slightly higher than the top rate in British Columbia (14.7 per cent). While Alberta’s top rate takes effect at a higher level of income, the province can no longer boast of having a uniquely straightforward and pro-growth approach to personal income taxes. Moreover, Alberta’s combined personal and federal income tax rate used to be lower than all U.S. jurisdictions including rival energy-producing states. By the time the new federal top rate takes effect, it will have one of the highest top rates in North America. This component of Alberta’s tax advantage is, simply, a thing of the past.

Next let’s consider corporate taxes. Up until June of last year, Alberta enjoyed the lowest general corporate income tax rate in Canada. In 2016, Alberta’s corporate income tax rate increased by 20 per cent, moving the province into a tie with Manitoba and Saskatchewan. B.C., Ontario, and Quebec all now have lower statutory corporate income tax rates than Alberta. Alberta is no longer the lowest tax province in Canada when it comes to the corporate income tax rate.

While some argue that increasing corporate taxes is a matter of fairness, in reality the burden of corporate taxes isn’t borne just by shareholders, but also by workers through lower wages and consumers through higher prices. A recent Fraser Institute study found that increasing corporate tax rates by one per cent reduces hourly wages by between 0.15 and 0.24 per cent.

Finally, there is the recently announced carbon tax. While initially billed as revenue neutral, it will in fact amount to a multi-billion dollar tax increase that will be used to fund new spending initiatives.

Although Alberta’s overall tax burden may still be lower than neighbouring jurisdictions, the loss of Alberta’s advantage on key tax rates is an important blow to the province’s economic competitiveness. And it comes at a very inopportune time, as the province struggles with a weak economy and depressed commodity prices.

The finance minister is right to acknowledge the importance of tax competitiveness. However, since coming into office, his government has badly undermined Alberta’s tax advantage by increasing key tax rates. If Alberta is to remain a magnet for talent and investment, the provincial government must refocus on building Alberta’s tax advantage.