CA AB1604

Imposes a 10% oil severance tax on producers for the privilege of extracting oil from California earth or water, applied to the gross value of each barrel of oil severed.

Tax is administered by the State Board of Equalization under the Fee Collection Procedures Law, with quarterly payments due by the last day of the month following each calendar quarter.

Exempts stripper wells (averaging 10 barrels or fewer per day) when average oil price is below $30 per barrel, and reduces tax to zero for 10 years on wells qualifying under Public Resources Code Section 3251 or inactive for five consecutive years.

Prohibits producers from passing the tax through to consumers via higher prices for oil, natural gas, gasoline, diesel, or related byproducts, with the State Board of Equalization authorized to monitor and investigate price gouging.

All revenues collected are deposited into the General Fund after deducting refunds and administrative expenses; the tax becomes operative on the first day of the first calendar quarter commencing more than 90 days after the act's effective date.