Newsom, NY Dems seek 100% tax on Trump’s $1.8B ‘anti-weaponization’ fund: 'Too bad, we're taking it'

WASHINGTON, DC: President Donald Trump’s “anti-weaponization” fund is facing mounting resistance from Democratic lawmakers in California and New York, with proposals emerging to tax any payouts from the fund at 100%.

California Governor Gavin Newsom announced on Wednesday, May 27, that his administration intends to pursue a full tax on California residents who receive money from the fund, while New York Assemblyman Alex Bores unveiled similar legislation targeting recipients in his state.

The pushback follows the Justice Department’s announcement last week that it would establish a roughly $1.8 billion compensation fund as part of a settlement tied to Trump’s lawsuit against the IRS.

Critics from both parties have questioned the legality and scope of the fund amid concerns that some January 6 Capitol riot defendants could seek compensation after receiving pardons from Trump.

California targets Trump fund payouts with 100% tax

Speaking at a news conference, Newsom said California would move to impose a “100% tax” on any resident receiving money through the federal fund.

“Anyone from California that receives any of those funds, we want to tax 100% of those proceeds,” Newsom said, describing the compensation pool as a “slush fund.” He added, “And that’s an action the state of California can take, it’s an action we look forward to taking.”

The governor made the announcement while signing Senate Bill 73, emergency legislation aimed at restricting law enforcement agencies from seizing ballots or election materials without proper authorization.

Newsom framed both issues as part of California’s response to actions taken by Trump and his allies around election administration and federal power.

The DOJ announced the “anti-weaponization” fund after Trump agreed to drop a $10 billion lawsuit against the IRS.

According to the department, the program is intended to compensate individuals who were allegedly targeted through politically motivated investigations or prosecutions.

Democrats push 100% tax on Trump fund

In New York, Democratic Assemblyman Alex Bores said he is drafting legislation called the “Anti-Insurrectionist Act,” which would similarly impose a 100% state income tax on residents who receive payments from the fund.

“It’s simple, if you’re a New Yorker and you take from this illegal slush fund, New York state will tax 100% of it,” Bores said in a video posted on X.

“If you storm the Capitol and you take from this slush fund, too bad we’re taking it."  

Bores said the proposal is intended to prevent New York residents from benefiting financially from what he described as “a publicly funded political payout.”

His office noted that roughly 80 to 90 individuals charged in connection with January 6 were from New York state.

The DOJ has said the fund will establish “a systematic process to hear and redress claims of others who suffered weaponization and lawfare.”

Trump, Donald Trump Jr, Eric Trump, and the Trump Organization are not expected to receive direct compensation from the fund, though the IRS agreed to issue a formal apology as part of the settlement.