Newsom Calls For National Billionaire Tax After Fighting California Wealth Tax Measure

Gavin Newsom called Friday for a national tax hike on the ultra-wealthy, the most assertive move yet by the California governor to advance a populist economic message ahead of his likely presidential run.

“It’s time for an economic reset in America,” Newsom writes in an op-ed on his Substack.

His plan to address the country’s yawning wealth gap includes “a true minimum tax on billionaires and those with a net worth of $100 million” and creating a national public equity fund to give all Americans a stake in the economic gains created by artificial intelligence companies.

Newsom released his proposal — headlined “It’s time for a national billionaires’ tax and a new social compact” — less than a day after a California wealth tax measure was officially cemented on the November ballot, despite objections from Newsom, who with his allies mounted an intense pressure campaign on the measure’s proponents to back down.

The governor said he understands “the anxiety driving the wealth tax proposal in California,” but argues the measure was flawed for directing roughly 90 percent of the revenue raised to offset the federal government’s coming health care cuts. He notes the one-time 5 percent tax on assets does not fund schools, housing, childcare or other public services — a preview of the message likely to be hammered by its odd-bedfellows opposition, which includes Planned Parenthood, the California Teachers Association and some of the world’s wealthiest people.

“We can’t let a single advocacy organization, however well-intentioned, write the state’s tax code on its own terms,” Newsom writes in a swipe at SEIU-UHW, the health care union sponsoring the initiative.

The measure’s backers have taken their own shots at the governor. Dave Regan, the union’s leader, laced into Newsom on Thursday afternoon, asserting the governor “has made it perfectly clear that he is … in lockstep with the 250 billionaires in California.”

By unveiling his alternative proposal so soon after the initiative confirmed its place on the ballot, Newsom makes clear his effort to redirect the conversation onto territory that positions him as a champion of taxing billionaires rather than an adversary. And raising the stakes to the national level inevitably stokes speculation about his White House aspirations.

“Wealth is movable, and it shops for the state with the lowest taxes,” he writes. “The fight belongs at the federal level, where this broken system was created in the first place.”

Newsom’s tax plan has several planks, including a “modern Buffett rule” which would ensure that top earners do not pay a lower tax rate than their workers. He also calls for ending the maneuver that allows the wealthy to borrow against appreciated assets such as their stock portfolio to finance their living expenses tax-free, revamping inheritance rules, closing offshore loopholes and returning corporate rates to levels prior to President Donald Trump’s 2017 tax cuts.

The plan is a stark pivot from Newsom’s general resistance to raising state taxes during his two terms as governor.

“Trickle-down economics has been a nearly 50-year experiment that has failed,” Newsom writes.

Newsom pairs his soak-the-rich tax plans with the creation of a national equity fund aimed at cushioning workers from AI-driven job losses through increased severance, portable benefits or expanded unemployment insurance.

There are more hints of other planks to come in his potential presidential campaign pitch, such as universal child care and free higher education and career training. He concludes by teasing more details of his “national agenda” in the weeks ahead — and with a plug for readers to subscribe to his Substack.