Lithium Extraction Tax Return

The California Department of Tax and Fee Administration (CDTFA) administers the Lithium Extraction Tax Law. Effective January 1, 2023, a lithium extraction excise tax is imposed on any person (producer) extracting lithium from geothermal fluid, spodumene ore, rock, minerals, clay, or any other naturally occurring substance in California.

The tax rate is based on the cumulative total metric tons of lithium carbonate equivalent extracted by a producer from the date the first metric ton of lithium carbonate equivalent was extracted. There are three different tax rates per metric ton based on the cumulative total amount of lithium carbonate equivalent extracted.

Filing Requirements

Every producer extracting lithium from geothermal fluid, spodumene ore, rock, minerals, clay, or any other naturally occurring substance in California, is required to electronically file a Lithium Excise Tax Return for the reporting period, on or before the last day of the month following the reporting period. You must file a return each reporting period, even if there are no reportable activity or no amount is due. Payment for the amount due must be submitted by the due date of the return.

You must keep a copy of the return on the premises for verification by CDTFA auditors. You must retain your records for at least four years from the time the tax is due unless we give written authorization to destroy them sooner. For additional information regarding record retention, please refer to Regulations 3501 and 4901.

Penalty and Interest

The penalty for filing a late return or late payment is ten percent of the amount due for the period. Interest also applies to late payments for each month or fraction of a month that the payment is late. (Revenue and Taxation Code section 55042)

Did you extract lithium and/or lithium compound(s) during the reporting period?

If you extracted lithium and/or lithium compound(s) during the reporting period, select Yes, and click Next.

If you did not extract lithium and/or lithium compound(s) during the reporting period, select No, and click Next.

All registered lithium extraction sites are listed on this screen.

Do you have additional lithium extraction sites not listed above?

If you have an additional lithium extraction site(s) not listed, select Yes, and click the Add a Record hyperlink to enter the site information (refer to the Unregistered Site Information section below for more information).

If you do not have additional extraction sites, select No, and click Next.

Unregistered Site Information

Click the Add a Record hyperlink to add additional lithium extraction sites.

Country. Auto populated to USA.

Street. Enter the location's street number and street name.

Street 2. If you need additional space, enter the rest of the street information in this field.

Unit Type. Select the unit type. (if applicable)

Unit. Enter the unit number. (if applicable)

City. Enter the location's city.

State. Select the location's state. Defaulted to California.

ZIP Code. Enter the location's five digit ZIP code.

County. Select the location's county.

Validate Address. Click the Validate Address button to verify the inputted address.

Once you have input all the required information, click the Add button. To add another site, click the Add a Record hyperlink. Once all additional extraction sites have been entered click Next to continue.

Enter the metric tons of lithium and/or lithium compounds extracted in each applicable category by county, rounding to the nearest thousandth decimal point.

The tax rate is based on the cumulative total metric tons of lithium carbonate equivalent extracted by a producer from the date the first metric ton of lithium carbonate equivalent was extracted. There are three different tax rates per metric ton based on the cumulative total amount of lithium carbonate equivalent extracted.

For example: If the cumulative extracted total metric tons previously reported is 19,000.123 and you extracted an additional 30,500.456 metric tons this reporting period, below is how you would report the 30,500.456 metric tons.

Calculation breakdown:

1. 20,000 (reporting limit for the 1^st category) − 19,000.123 (previously reported tonnage) = 999.877 (remaining tonnage to be reported in the 1^st category for the current reporting period) × 400 (tax rate)
2. 30,000 − 20,000 (reporting limit for the 2^nd category) = 10,000.000 (remaining tonnage to be reported in the 2^nd category for the current reporting period) × 600 (tax rate)
3. 30,500.456 (total tonnage extracted for this reporting period) − 999.877 (tonnage to fulfill the 1^st category) − 10,000.000 (tonnage to fulfill the 2^nd category) = 19,500.579 (remaining tonnage to be reported in the 3^rd category for the current reporting period) × 800 (tax rate)

Did you collect excess lithium excise tax reimbursement?

If you collected excess lithium excise tax reimbursement for this reporting period, select Yes and enter the amount of excess tax collected for each site, if applicable.

If you did not over-collect for this reporting period, select No.

• Lithium Extraction Excise Tax Guide
• Lithium Extraction Tax Law