Newsom urges national tax on ‘billionaires’ while fighting it in California

California Gov. Gavin Newsom, a Democrat who is considering a presidential run as he approaches the end of his term, called for a national “billionaire tax” on Friday even as he fights another proposal targeting the wealthy in his home state.

Newsom also said the US government should own a stake in AI companies. His proposals, outlined in a subpost, align him with the Democratic Party’s populist left, arguing that urgent changes are needed to prevent elite concentration of wealth and power from undermining democracy.

“It is time to reset America’s economy,” Newsom wrote.

The governor announced his agenda a day after an influential California health care union pledged to move forward with a ballot measure that would impose a one-time 5% tax on the assets of billionaires living in the state starting Jan. 1, 2026.

Newsom opposes the measure, as do many liberal interest groups that typically favor higher taxes. They fear it would drive billionaires out of California, eroding the state’s tax base in the long run for a one-time influx of money. California, considered a tech mecca, has more billionaires than any other state — a few hundred, by some estimates.

“You may not be able to move to Texas or Florida to shelter your income from taxes, but I promise you that billionaires can, and do,” Newsom wrote. “The wealth is transferred, and it is marketed to the state with the lowest taxes. The fight is at the federal level, where this broken system was created in the first place.”

Minimum taxes on large wealth

Newsom said the solution is a new national tax policy, rather than a state-by-state system. He proposed imposing a minimum tax on anyone with a net worth of more than $100 million. He also wants to make it illegal for the wealthy to borrow against their stock portfolios to finance their luxurious lifestyles tax-free.

Newsom said there should be new rules for inheritance taxes, warning that “the transfer of wealth among the wealthy will establish a permanent American aristocracy of inherited wealth.” He wants to raise corporate tax rates to what they were before President Donald Trump’s first-term tax cut.

Read more: Sanders and Newsom clash over proposed tax on California billionaires

The need is particularly urgent because artificial intelligence threatens to displace workers and increase the concentration of wealth, he wrote.

“We need to ensure that every American owns a stake in the future that AI is building through a national public equity fund that takes a significant stake in the new economy,” he wrote. “Simply put, as artificial intelligence reshapes the country, every American must own a piece of the future it builds.”

The revenue generated by his proposals could be used to retrain workers, fund universal child care, make college tuition free, and increase health care funding.

“Money buys influence”

Newsom, who has drawn attention as one of Trump’s most prominent political opponents, got an early start on laying out a political framework for his potential bid for the White House months before the midterm elections, which typically mark the unofficial start of an overt presidential campaign.

WATCH: News Wrap: Newsom says Trump ordered DOJ to investigate him and his wife

The embrace of a wealth tax by Newsom, a moderate on tax policy despite his liberal reputation, signals a marked shift in the political landscape since Massachusetts Sen. Elizabeth Warren struggled to gain traction in her 2020 campaign, which largely centered around a 2% wealth tax.

Newsom portrayed the nation’s tax code as a corrupt system designed to help an elite few.

“Money buys power, and power rewrites the rules,” he wrote. “These rewritten rules transfer more wealth to the few. Under this pressure, democracy itself begins to collapse.”