California Plans 100% Tax on Trump January 6 Compensation Fund, Governor Says

California Governor Gavin Newsom has announced that the state plans to impose a 100% tax on any payments received by California residents from a federal fund created under the Trump administration for alleged political “weaponization” cases.

The fund, valued at about $1.776 billion, was set up following a legal settlement linked to former President Donald Trump’s dispute with the Internal Revenue Service over leaked tax returns. The program is intended to compensate individuals tied to prosecutions and losses related to January 6 cases, including defendants pardoned last year.

Newsom said California would tax the payments in full for state residents, meaning recipients would not keep any of the compensation. He added that the state has the legal authority to take such action and plans to proceed, although no timeline was provided.

Political Debate Over January 6 Compensation Fund

The proposal has triggered sharp political reactions. The White House and US Department of Justice did not immediately respond to the announcement.

The fund itself has already faced legal challenges, including a case filed by two Capitol Police officers who defended the US Capitol during the January 6, 2021 riot.

Critics, including some lawmakers, have questioned whether the program is lawful. Republican Senator Thom Tillis said it would be unreasonable for individuals convicted or pardoned for January 6 offenses to receive financial compensation for their actions.

The debate continues as both legal and political scrutiny grows around how the federal settlement and compensation program will be implemented.