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Democrat Proposed 9.5% Oil Tax Pushes Through California Senate Committee

Democrat Proposed 9.5% Oil Tax Pushes Through California Senate Committee

The Senate Education Committee voted 5-2 — the minimum number of votes needed — to advance a bill that would levy a 9.5% tax on oil pumped from the ground in California. The aim is to raise $2 billion annually to be divided among state universities and colleges, state parks, and human service programs, according to the Los Angeles Times.

The controversial SB 1017, which was authored by Sen. Noreen Evans (D-Santa Rosa), has been dubbed a “job killer” by the California Chamber of Commerce, as it would most likely decrease oil production and drive oil companies out of California, costing thousands of jobs. One such company, Occidental Petroleum, is leaving California for Houston, Texas — dubbed “the energy capital of the world” — after being in Los Angeles for nearly a century.

Texas Governor Rick Perry has recently mounted a campaign encouraging companies that are stagnating in California to relocate to the Lone Star State, where he touts lower taxes and less regulation. If SB 1017 is passed, Perry’s wish may become a reality, particularly as it pertains to oil companies in California.

Backers of the measure included dozens of students who stand to benefit from it, including those enrolled at the University of California, California State University, and California Community Colleges. “There can be no question that higher education needs additional funding,” said committee member Sen. Marty Block (D-San Diego). Money from the proposed bill would also go to the State Department of Parks and Recreation and the California Health and Human Services Agency, the Times reports.

Opposition came from the Western States Petroleum Association and some local elected officials, including from Kern County, a major oil-producing area. Senate Republican leader Bob Huff of Diamond Bar said the goal of the U.S. should be energy independence. “This is obviously a bill that would fly opposite of that,” Huff said.

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