Significant tax legislation signed into law included: SB 38 (Battin) providing tax relief for those affected by the Esperanza Fire in Riverside County in 2006; SB 41 (Battin) enacting the California Fallen Firefighter Assistance Tax Clarification Act; SB 87 (Senate Budget and Fiscal Review Committee) enacting the state revenue and tax administration trailer bill to the 2007 Budget Act, which among other provisions, enacted a streamlined method of property tax collection for fractionally-owned aircraft, and repeals the teacher tax credit; SB 105 (Migden) clarifying how California is to treat registered domestic partners in specified instances where state and federal law conflict; SB 114 (Florez) providing tax relief to the counties and individuals affected by the January 2007 freeze; SB 559 (Kehoe) allowing registered domestic partners whose property was reassessed due to a change of ownership between January 1, 2000 and January 1, 2006, to apply to the county assessor to receive a reversal of the reassessment; SB 788 (Cogdill) permitting the Franchise Tax Board to conduct audits of water's edge taxpayers on a discretionary, rather than a mandatory, basis; SB 898 (Simitian) extending the sunset on the Children's Trust Fund for the Prevention of Child Abuse and the Rare and Endangered Species Preservation Program tax checkoffs for five years; SB 920 (Oropeza) improving the information sharing between state agencies to assist Californians to reclaim their unclaimed property; AB 28 (Huffman) extending the sunset date for the California Breast Cancer Research Fund tax checkoff for five years; AB 62 (Nava) providing tax relief to those affected by the wildfires that occurred in Ventura, El Dorado, and Santa Barbara Counties in 2006-07; AB 198 (Assembly Budget Committee) changes the bases for reportable income for determination of the limited liability corporation fee; AB 297 (Maze) granting a limited exemption from property tax for certain vines and trees damaged in the January 2007 freeze as to require specific pruning remediation; AB 402 (Ma) extending change of ownership exclusion to transfers between foster parents and foster children, and enacts reporting requirements for residential cooperative housing; AB 650 (Lieu) requiring employers to notify employees that they may qualify for the federal earned income tax credit; AB 897 (Houston) permitting specified organizations that are tax-exempt for federal tax purposes to be treated as tax-exempt organization for California tax purposes without first receiving approval by the Franchise Tax Board; and AB 1020 (Runner) providing that the recordation of a certificate of sale for property sold with redemption rights does not constitute a change of ownership.

Vetoed tax legislation included: AB 843 (Eng) amending the current rules for reporting changes of ownership of property, changing the maximum penalty that may be imposed for property not eligible for a homeowners' exemption, and adding clear direction for mailing requests for unfilled change of ownership statements; AB 969 (Eng) replacing permissive provisions with respect to reporting use tax liability on an acceptable tax return with mandatory provisions; AB 1617 (DeSaulnier) facilitating the collection of taxes on cigarettes and tobacco products sold to residents of California over the Internet or by mail order; and AB 1618 (Feuer) repealing the interest offset provisions of the corporation tax law to reflect the United States Supreme Court's decision in Hunt-Wesson.