California Gov. Gavin Newsom vetoed a bill shielding future reparations payments from state income tax, leaving the Democratic author deeply disappointed and vowing a return fight.
On Sept. 30, Newsom rejected Assembly Bill 2186, legislation that would have excluded “any reparations benefit or payment” from California personal income tax for qualifying state, local, or federal programs. The measure, authored by Assemblymember Tina McKinnor, D-Inglewood, targeted taxable years beginning on or after Jan. 1, 2028, and before Jan. 1, 2033.
Fox News Digital reported McKinnor’s blunt reaction and Newsom’s official veto message, which cited unknown costs and pressure on the state’s General Fund. The governor signed a separate corporate disclosure bill the same period, keeping California’s reparations machinery running even as cash-related tax relief stalled.
McKinnor did not hide her frustration. She framed the veto as hesitation dressed up as caution.
"I am deeply disappointed that Governor Newsom vetoed AB 2186. Reparations are not a gift or a government handout,"
She added that payments are meant to repair harm, “not be partially taken back through taxation.”
Newsom’s veto message thanked McKinnor for work on “the documented harms of slavery” and pointed to prior action. He noted he had signed legislation creating the Bureau for Descendants of American Slavery, described as a first-in-the-nation state agency that will advise on reparative justice programs for Black Americans.
“California’s work on this important endeavor is just beginning,” the governor wrote. Then came the brake.
"Because the full scope of the proposed tax exclusion is unknown, fiscal caution is warranted,"
Newsom warned that an exclusion covering “unspecified federal initiatives could be interpreted broadly, resulting in substantial fiscal uncertainty.” He said the measure’s “potentially significant General Fund implications” belong in the annual budget process, not a standalone bill. When his office was reached for further comment, it replied that “the veto message speaks for itself.”
That stance fits a longer pattern. California was first to stand up a formal task force on slavery’s legacy and possible restitution. Concrete direct-cash ideas at the state level have repeatedly hit budget walls and legal risk. Newsom has vetoed multiple reparations proposals on those same grounds. Taxpayers keep funding studies and agencies while the open-ended price tag of payouts stays off the books.
McKinnor answered the fiscal argument directly and kept the pressure on.
"California cannot claim to support reparative justice while taxing the very compensation intended to repair that harm. I respect the Governor's concerns about fiscal responsibility, but justice must also be a priority."
The same stretch of bill action produced a different outcome for Assembly Bill 2599, authored by Assemblymember Isaac Bryan, D-Ladera Heights. Newsom signed it. The law requires large companies doing business in California, those with more than $100 million in annual worldwide gross receipts that existed, or had a predecessor that existed, on or before Dec. 31, 1964, to search historical records and publicly disclose slavery-era transactions.
Covered firms must file sworn affidavits under penalty of perjury. The affidavits cover purchases or sales of enslaved people, use of enslaved people as loan collateral, slave-related insurance policies, and related deals. Once the Legislature funds the program, companies have until January 2029 to submit first affidavits. It is another first-in-the-nation mandate, shifting compliance costs onto businesses while direct tax relief for any future payments remains blocked.
Local experiments elsewhere already show what cash programs look like in practice. In Evanston, Illinois, a Chicago suburb, Black residents received $25,000 housing grants aimed at historic housing discrimination. Other race-based local efforts have drawn legal challenges. California’s statewide version keeps expanding process, task forces, a new bureau, corporate paper trails, while Newsom draws a line at a tax exclusion whose price he says no one can yet calculate.
McKinnor cast the veto as delay by another name and looked past the current term.
"We cannot continue to study injustice, acknowledge the harm, and then hesitate when it is time to act,"
She said she remains committed to working with colleagues “and the new Governor to bring this legislation back in 2027,” adding that “justice delayed should not become justice denied.”
That reference to a new governor lands as Newsom’s own future stays a live political subject, including Newsom’s pledge to stand aside in 2028 if Kamala Harris enters the race.
AB 2186 would have defined a “reparations benefit or payment” broadly: any monetary payment, grant, trust distribution, debt forgiveness, or other financial compensation from a qualifying program. By killing the tax shield, Newsom left any future recipients exposed to state income tax and forced the debate into the budget scrum, where every dollar competes with schools, pensions, and existing obligations.
Supporters call the payments compensation for generations of injustice, discrimination, and economic harm. Critics inside and outside Sacramento see an open-ended claim on current taxpayers for historical wrongs none of them committed, layered onto a state already wrestling with high costs and uncertain revenues. Newsom’s own words concede the scope is unknown. That is precisely why fiscal caution is the responsible default.
The governor’s broader record keeps drawing scrutiny on multiple fronts, from his 25% tax on private ICE detention centers to ongoing speculation about national ambitions.
His household has also faced pointed questions, including moments when Jennifer Siebel Newsom sidestepped presidential ambition questions on national television.
Personal history remains part of the public file as well, with fresh attention on accounts tied to a past affair in coverage of Ruby Rippey-Gibney’s planned Vanity Fair remarks.
None of that changes the ledger on AB 2186. A Democratic governor told a Democratic author the tax break was too vague and too expensive to enact outside the budget. The bureau and the corporate affidavit law moved forward. The cash-adjacent tax relief did not.
McKinnor’s promise to revive the bill in 2027 ensures the fight continues after Newsom leaves Sacramento. Until then, California will keep studying, advising, and compelling old corporate records while the actual cost of reparations payments stays carefully unwritten.
When the bill comes due, taxpayers, not task forces, pen the check.
