California is set to become the first state to sue President Donald Trump over his tariffs.
Gov. Gavin Newsom announced Wednesday (April 16) that the state — the fifth largest economy in the world — would file suit against the president over the new levies.
“No state will be impacted more than the state of California as it relates to the unilateral authority that’s been asserted by the Trump administration to impose the largest tax increase in modern American history,” the governor said in a video shared to X.
Donald Trump does not have the authority to unilaterally impose the largest tax hike of our lifetime with his destructive tariffs.
We’re taking him to court. pic.twitter.com/LAm1NRx300
— Gavin Newsom (@GavinNewsom) April 16, 2025
Newsom and California Attorney General Rob Bonta were scheduled to hold a news conference Wednesday afternoon announcing the suit.
The wide-ranging tariffs, announced earlier this month during an event Trump dubbed “Liberation Day,“ include 145% levies on imports from China. The shift — which the White House says is aimed at lowering America’s trade deficit and boosting domestic manufacturing, has led to stock market upheaval and caused strains in U.S. relations with trading partners.
“The President’s chaotic and haphazard implementation of tariffs is not only deeply troubling, it’s illegal,” Bonta said in a statement shared by several news outlets.
“As the fifth largest economy in the world, California understands global trade policy is not just a game. Californians are bracing for fallout from the impact of the President’s choices — from farmers in the Central Valley, to small businesses in Sacramento, and worried families at the kitchen table,” he said.
The White House criticized Newsom over the lawsuit, saying the governor should focus on his state’s issues rather than trying to block Trump’s “efforts to finally address the national emergency of our country’s persistent goods trade deficits,” per a report by CNBC.
In related news, PYMNTS wrote Wednesday about earnings from some of the country’s biggest banks, which showed consumer spending up and executives feeling cautious due to shifts in U.S. trade policy.
“Tariffs and the potential for a recession have not yet dramatically curbed consumer appetite, though some pullback in commercial lending and elevated caution on credit were evident,” that report said. “Digital adoption across retail banking and payments continues at a brisk pace, reflecting banks’ strategic push toward technology-driven growth.”
