Gavin Newsom Says California Will Seek 100% Tax on Residents Who Get Money From Trump's Slush Fund'

The Department of Justice created an anti-weaponization fund after President Donald Trump dropped a lawsuit against the IRS. The fund totals $1.776 billion and will make payouts to people who show to a DOJ commission that they were victims of weaponization. Critics argue that many participants in the Jan. 6 Capitol riot could qualify. Trump previously sued his own administration for $10 billion related to leaks of his tax returns, and reporting in 2020 said he paid $750 in income tax in 2016 and 2017. After taking office again in January 2025, Trump pardoned nearly all Jan. 6 defendants. Newsom called the fund a slush fund and said Californians receiving payments should be taxed on those gains at 100%. Democratic lawmakers in New York and New Jersey began drafting similar 100% taxation legislation.

"The Department of Justice created the fund in exchange for Trump dropping his lawsuit against the IRS. The unprecedented $1.776 billion fund will make payouts to those who demonstrate to a DOJ commission that they were victims of weaponization. Critics have noted that any number of people who participated in the Jan. 6 Capitol riot could qualify. Upon taking office a second time in January 2025, Trump pardoned virtually every Jan. 6 defendant."

"Newsom slammed the scheme on Wednesday and said any Californians who receive payments from the fund should be taxed on those gains at a rate of 100%. Anyone from California that receives any of those funds, we wanna tax 100% of those proceeds, he said. And that's an action the state of California can take. It's an action we look forward to taking."

"In January, the president sued his own administration for $10 billion in damages stemming from a leak of his tax returns that occurred during his first term. His sons Donald Trump Jr. and Eric Trump, who run the Trump Organization, also sued. Based on the leaks, the Times reported in 2020 that the billionaire president paid just $750 in income tax in 2016 and in 2017."

"In a social media post containing the governor's remarks, Newsom called the pool of money a slush fund. Democratic lawmakers in New York and New Jersey have already started drafting legislation that would tax payouts from the fund at 100%."

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