Gavin Newsom opposes a California wealth tax. He’s proposing a national billionaire tax instead

By Edward-Isaac Dovere, CNN

(CNN) — California Gov. Gavin Newsom on Friday proposed a national tax on billionaires that he says is the first part of an “economic reset for America” agenda, which aides explicitly say is part of his considering to launch a presidential campaign.

“The system America’s founders built was designed to prevent the concentration of power in a few hands, but we have allowed that concentration to happen anyway, slowly, in plain sight, over decades,” Newsom writes. “We can reverse it together, as a country.”

It is extremely early in the presidential campaign cycle for a policy proposal — but comes as Democrats continue to embrace economic populism and moves against the wealthy. It also comes as California voters in November will decide on a billionaires’ tax after the governor and opponents of the tax late Thursday failed to reach a deal to keep it off the ballot.

Newsom, who is term-limited in California and will leave office in January 2027, lays out his proposal in a Substack post that went live on Friday morning, calling for a minimum tax on anyone worth more than $100 million so that they pay at least the same rate, rather than less, than the average American worker who doesn’t have loopholes and other maneuvers to benefit from.

Various wealth tax ideas have been proposed by Democrats before, including by Massachusetts Sen. Elizabeth Warren as part of her 2020 Democratic presidential campaign. Newsom says his idea comes out of wanting to create a bulwark against how artificial intelligence will reshape the economy, also proposing what he calls a “national public equity fund” to give every American, rather than just tech companies and investors, a share in the wealth likely to be produced. That fund, an aide said, would cover worker transition benefits, universal childcare, free higher education and career training, healthcare and a national industrial strategy for AI.

Newsom also called for rewriting the rules around inheritance, arguing that with what he says will be the largest intergenerational wealth transfer in human history coming over the next 20 years, “if we do not act, that transfer of wealth among the ultra-wealthy will lock in a permanent American aristocracy of inherited wealth, with all the political consequences the founders warned us about.”

Newsom explains why that he will personally vote no on the California proposal, which would levy a one-time 5% tax on residents with a net worth over $1 billion.

Backers of the measure gathered more than 870,000 signatures and include progressives like Vermont Sen. Bernie Sanders and California Rep. Ro Khanna – himself a 2028 contender. Newsom and others fear it would drive businesses out of California, and that the revenue collected would not be spread around widely enough.

“We’re competing with 50 states,” Newsom told the World Economic Forum earlier this year. “Capital flows and move(s). That’s real. It’s not imagined. It’s very, very real.”

In his Substack post, Newsom writes that while he understands “the anxiety” driving interest in the California proposed tax, it “turns a blind eye to safety-net clinics and reproductive healthcare providers that Planned Parenthood has fought for decades to protect. There is nothing for housing, nothing for childcare, nothing for public safety workers who must answer 911 calls, and nothing for our public universities that have powered California’s economy for a decade.”

Long a presumed candidate for president in 2028, Newsom has begun to show his political hand more explicitly with a video last week about what he said was a Justice Department investigation into his wife, Jennifer Siebel Newsom: “Donald Trump isn’t just coming after me because of my mean tweets, he’s coming after me because I am considering running for president.”

CNN confirmed earlier this month that Jennifer Siebel Newsom is under investigation. However, a person familiar with the probe denied that it was launched by the department’s Trump-appointed leadership in DC.

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