Newsom Did Back a 100% Tax — But Only on Payments From Trump’s Anti-Weaponization Fund

California Governor Gavin Newsom signed legislation imposing a 100% state tax on payments from a specific Trump administration compensation program. Viral posts claiming California will seize “any funds from Trump” leave out a critical limitation.

California Governor Gavin Newsom did back a 100% state tax, but the viral quote removes crucial context: the tax targets payments from a specific Trump administration fund, not every federal payment connected to President Trump.

Newsom announced the proposal on May 27, saying California wanted to tax 100% of proceeds received by state residents from the federal Anti-Weaponization Fund established by the Justice Department earlier that month.

His exact remarks referred to “those funds,” meaning payments from the $1.776 billion program. The broader wording circulating online — “if you take any funds from Trump” — makes the policy sound far more sweeping.

The Justice Department announced the Anti-Weaponization Fund on May 18 as part of a settlement resolving litigation brought by Trump, his sons and the Trump Organization over the unauthorized disclosure of tax information.

Under the announced framework, Trump and the other plaintiffs were to receive an official apology rather than personal damages, while the new fund would consider claims from people alleging improper political targeting by federal authorities.

The program was designed to receive $1.776 billion from the federal judgment fund, with a five-member panel empowered to review claims and award monetary relief or formal apologies to successful applicants.

Newsom and other critics argued the structure could benefit people connected to January 6 prosecutions. The Justice Department said eligibility was not partisan and that anyone claiming improper government weaponization could seek consideration.

California lawmakers subsequently incorporated Newsom’s proposal into Senate Bill 122, a budget-related tax measure, and Newsom signed the legislation on June 30 as part of the state’s 2026 budget package.

According to Newsom’s office, the law imposes a 100% California tax on distributions from the Anti-Weaponization Fund, reflecting the state government’s opposition to giving those payments favorable state tax treatment.

The Los Angeles Times reported that the provision applies to qualifying settlement-fund payments during tax years 2026 through 2030 and can also reach a successor arrangement created for substantially the same purpose.

That does not mean California enacted a 100% tax on every payment, grant, benefit, refund or proposed dividend associated with the Trump administration. The law is tied to this specific compensation mechanism.

The distinction has become especially relevant because Trump has separately promoted other federal payment ideas, including a proposed $5,000 dividend. California’s Anti-Weaponization Fund tax does not automatically apply to unrelated federal programs.

The federal fund itself quickly encountered legal trouble. On May 29, U.S. District Judge Leonie Brinkema temporarily blocked officials from transferring money, considering claims or making payments while litigation challenging the program proceeded.

On June 12, Brinkema issued a preliminary injunction continuing that block, while the Justice Department maintained in court that the controversial fund was no longer moving forward and no money had been distributed.

The situation changed again on August 2, when Acting Attorney General Todd Blanche formally rescinded his May order establishing the fund and declared that no commissioners, payment system or claims process had become operational.

The Justice Department’s rescission stated that no money had been transferred and no claims had been paid, asserting that the written order should remove any doubt that the fund was not operating.

Even so, litigation has continued. On September 19, a federal judge declined to accept the government’s mootness argument at this stage, citing questions about whether the challenged arrangement or a similar program could return.

That legal uncertainty means California’s tax provision remains relevant as a precautionary measure, but there is currently no functioning Anti-Weaponization Fund distributing payments that California can actually tax.

Newsom’s original statement was therefore real, and California did enact the 100% tax. What is misleading is the viral paraphrase suggesting Californians would lose any money they accepted from Trump or his administration.

The most accurate summary is narrower: California enacted a 100% state tax on qualifying payments from Trump’s Anti-Weaponization Fund or a covered successor, while the federal program was later rescinded and remains under litigation.