SB 1280 — Excise tax; extending sunset of apportionments of excise tax collections on oil and gas. Effective date. Emergency.

ENGROSSEDAn Act ENROLLED SENATE BILL NO.

Bergstrom of the Senate and Kendrix of the House 5 An Act relating to excise tax;

BESUBJECT: IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:

Excise tax BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:

On petroleum oil sold at the time of production, the excise tax thereon shall be ENGR.paid by the purchaser, who is hereby authorized to deduct in making settlement with the producer and/or royalty owner the amount of tax so paid;

S.

B.

NO.

1280 Page 1 paid by the purchaser, who is hereby authorized to deduct in making settlement with the producer and/or royalty owner the amount of tax so paid;

The provisions of this subsection shall terminate on June 30, 2026 2031.

On petroleum oil sold at the time of production, the excise tax thereon shall be paid by the purchaser, who is hereby authorized to deduct in making settlement with the producer and/or royalty owner the amount of tax ENGR.so paid;

S.

B.

NO.

1280 Page 2 so paid;

Such excise tax of ninety-five one thousandths of one percent (.095 of 1%) of the gross value shall be reported to and collected by the Oklahoma Tax Commission at the same time and in the same manner as is provided by law for the collection of gross production tax on natural gas and/or casingheadENR. gas, and this excise tax shall apply in all cases where the gross production tax provided for by law applies to the production of natural gas and/or casinghead gas.

The excise tax shall be paid by the purchaser, who is hereby authorized to deduct ENGR.

1280 Page 32 casinghead gas, and this excise tax shall apply in makingall settlementcases withwhere the producergross and/orproduction royaltytax ownerprovided for by law applies to the amountproduction of taxnatural sogas paid;and/or casinghead gas.

The excise tax shall be paid by the purchaser, who is hereby authorized to deduct in making settlement with the producer and/or royalty owner the amount of tax so paid;

The provisions of this subsection shall terminate on June 30, 2026 2031.

provided, however, that if such natural gas and/or casinghead gas is retained by the producer, then the tax ENGR.shall be paid by the producer, who shall have the right to deduct the amount of tax so paid on royalty gas at the time of settlement with the royalty owner.

S.

B.

NO.

1280 Page 4 shall be paid by the producer, who shall have the right to deduct the amount of tax so paid on royalty gas at the time of settlement with the royalty owner.

Prior to July 1, 2026 2031, and as provided in Section 1103.1 of this title, all monies derived from the levy of the excise tax on petroleum oil provided for by Section 1101 of this title shall be deposited with the State Treasurer, who shall credit and apportion the same as follows:

a.ENR.

eighty-two and six hundred thirty-four thousandths percent (82.634%) of said the excise tax shall be credited to the General Revenue Fund of the State Treasury;

provided, in each fiscal year beginning on or after July 1, 2013, the first One Million Three Hundred Fifty Thousand Dollars ($1,350,000.00) which would otherwise have been apportioned to the General Revenue Fund pursuant to this subparagraph shall be transferred to the Oil and Gas Division Revolving Fund of the Oklahoma Corporation Commission, b.

ten and five hundred twenty-six thousandths percent (10.526%) shall be credited and apportioned to a separate and distinct fund to be known as the “Corporation Commission Plugging Fund”, and ENGR.

1280 Page 53 c.a.

eighty-two and six hundred thirty-four thousandths percent (82.634%) of said the excise tax shall be credited to the General Revenue Fund of the State Treasury;

provided, in each fiscal year beginning on or after July 1, 2013, the first One Million Three Hundred Fifty Thousand Dollars ($1,350,000.00) which would otherwise have been apportioned to the General Revenue Fund pursuant to this subparagraph shall be transferred to the Oil and Gas Division Revolving Fund of the Oklahoma Corporation Commission, b.

ten and five hundred twenty-six thousandths percent (10.526%) shall be credited and apportioned to a separate and distinct fund to be known as the “Corporation Commission Plugging Fund”, and c.

Prior to July 1, 2026 2031, and as provided in Section 1103.1 of this title, all monies derived from the levy of the excise tax on natural gas and/or casinghead gas provided for by Section 1102 of this title shall be deposited with the State Treasurer, who shall credit and apportion the same as follows:

ten and five thousand five hundred fifty-five ten thousandths percent (10.5555%) shall be credited and apportionedENR. to the Corporation Commission Plugging Fund, and ENGR.

1280 Page 64 apportioned to the Corporation Commission Plugging Fund, and c.

The fund shall be disbursed by the State Treasurer upon sworn, itemized claims approved by the assistant ENGR.representative and the Governor;

provided, that if at the end of any fiscal year any part of the special fund shall remain unexpended, such balance shall be transferred by the State Treasurer to, and become a part of, the General Revenue Fund of the state for the ensuing fiscal year.

Provided, further, that if the State of Oklahoma withdraws from the Interstate Compact to conserve oil and gas, any unencumbered monies in The Interstate Oil Compact Fund of Oklahoma shall be transferred to and become a part of the General Revenue Fund of the State Treasury and thereafter the excise tax on petroleum oil, natural gas and/or casinghead gas levied by this article shall be levied, collected and deposited in the General Revenue Fund of the State Treasury.