California’s governor stepped to a podium Wednesday and delivered a blunt promise — any California resident who collects a payment from President Donald Trump’s newly formed Anti-Weaponization Fund will hand the entire amount straight back to the state.
Governor Gavin Newsom made the announcement at a Sacramento news conference, offering no ambiguity about what the state intends to do.
“Anyone from California that receives any of those funds,” Newsom said. “We want to tax 100% of those proceeds and that’s an action the state of California can take. It’s an action we look forward to taking.”
The fund Newsom targeted carries a price tag of $1.776 billion. The Justice Department announced its creation in exchange for President Trump dropping a $10 billion lawsuit against the IRS over the leak of his tax returns.
The fund will be overseen by five individuals appointed by the U.S. attorney general. Supporters describe it as a legitimate mechanism to compensate Americans who can demonstrate the government unfairly targeted them.
Critics see it differently.
Democrats contend the fund could deliver payments to individuals convicted or charged in connection with the January 6, 2021, Capitol riot — a group Trump had already pardoned en masse on his first day back in the White House.
Newsom amplified that argument in a post on X, drawing a direct line between the pardons and the fund’s creation.
“He pardoned all of those folks that were beating up cops and absolved them, providing them 1.776 billion dollars. So not only do you get a pardon, you get rewarded,” Newsom wrote. “That’s why this is needed.”
Newsom’s office went further, labeling the fund a “Jan. 6th slush fund” in official communications. The governor did not provide a specific date for when the proposed tax would take effect.
The Justice Department wasted no time punching back.
Spokesperson Natalie Baldassarre said in an email: “Instead of flaunting their love of lawfare and taxing constituents into oblivion, Governors Hochul and Newsom should focus on preventing more of their residents from fleeing in droves to free states with lower taxes, less crime, and governments that actually serve the people they represent.”
Republicans in the state also trained their fire on Newsom, pointing to a pattern of spending they say undermines his credibility.
A $25 million California legal fund Newsom created to fight what he described as “legal warfare” from the Trump administration was later labeled a “slush fund” by California Republican Senate Minority Leader Brian Jones.
Scrutiny of Newsom’s fiscal record extends further.
A Kaiser Health News investigation found California awarded billions of dollars in emergency contracts to firms tied to donors, political allies, and well-connected insiders during the pandemic, with critics arguing the state’s emergency procurement system allowed taxpayer-funded contracts to be awarded with limited competition and oversight.
The governor’s proposed tax arrives as California faces a roughly $2.9 billion shortfall for the 2027 fiscal budget.
Newsom’s administration has also drawn sustained criticism over the state’s infrastructure spending. California’s high-speed rail project carries an estimated cost of $128 billion even though a single track has yet to be laid.
A wildlife crossing bridge drew separate ridicule after running $21 million over budget, prompting Transportation Secretary Sean Duffy to publicly call it a “bridge to nowhere.”
California is not the only blue state moving to block the fund. Legislation imposing a 100% tax on fund payouts is being pursued in California, New Jersey, and New York. New York State Assembly member Alex Bores introduced a bill titled the Anti-Insurrectionist Act targeting the payments.
The fund’s creation has drawn criticism from both parties, with some Republican senators also expressing anger at acting Attorney General Todd Blanche over the arrangement.
Newsom is broadly viewed as a strong contender for the Democratic presidential nomination in 2028. His frequent and public confrontations with the Trump White House have kept him at the center of national Democratic politics.
Fox News Digital reported it reached out to both the White House and Newsom’s office for comment.
