California – the largest U.S. state by population and the world's fourth-largest economy by itself — is the largest payer of federal taxes of all the states. Democratic Governor Gavin Newsom is now entertaining the idea of depriving President Donald Trump's administration of that revenue.
Politico reported Friday that Newsom tweeted the suggestion in response to Trump floating the idea of terminating all federal. grants to California's state universities. The two-term Democrat pointed out that his state pays roughly $83 billion more in federal taxes than it gets back, according to a Rockefeller Institute analysis.
"Californians pay the bills for the federal government," Newsom said. "Maybe it’s time to cut that off."
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Should Newsom follow through on that threat, it would cut off approximately 12.3% of the $4.67 trillion federal tax revenue the federal government received in 2023, according to data from the nonprofit USAFacts (founded by former Microsoft CEO Steve Ballmer). That means the Golden State alone put more than $574 billion in federal coffers that year.
When asked to comment on Newsom's threat, White House spokesperson Kush Desai would only say the administration "is committed to ending this nightmare and restoring the California Dream."
"“No final decisions, however, on any potential future action by the Administration have been made, and any discussion suggesting otherwise should be considered pure speculation," Desai said.
To date, no state has ever withheld taxes from the federal government, aside from the four years in which the Confederate States of America seceded from the union during the Civil War. The logistics of doing so would likely require an individual state passing legislation diverting all federal taxes withheld in the payroll process to state coffers instead of the IRS, and such a law would almost certainly be challenged in court by the administration on 16th Amendment grounds.
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Click here to read Politico's report in full.