NEW: Bessent Lays Down The Law On Gavin Newsom
Newsom’s Tax Threat Sparks Federal Warning
Tension Between California and Federal Government
California Governor Gavin Newsom threatened to withhold state tax payments to the federal government after President Trump warned of cutting federal funds to the state. Trump’s move comes in response to California’s ongoing legal challenges against federal policies, including immigration and transgender rights.
Budget Crisis and Federal Aid Dispute
Facing a second year of budget shortfalls and borrowing in its Medicaid program, California has requested $40 billion in fire relief. Meanwhile, federal officials have considered taking back high-speed rail funds, accusing the state of misusing them. “Californians pay the bills for the federal government,” Newsom posted on X. “We contribute over $80 BILLION more in taxes than we receive back. Perhaps it is time to terminate that.”
Treasury Secretary Responds
Treasury Secretary Scott Bessent warned that Newsom’s threat could be criminal. “Governor [Gavin Newsom] is threatening to engage in criminal tax evasion,” Bessent posted on X. He said the plan would “defraud the American taxpayer” and leave Californians liable. He also cautioned state payroll officials that evading federal taxes can bring personal legal consequences. “His statements are incredibly reckless,” Bessent added.
