What if we just stopped paying taxes?
Where there's a will there (might) be a way.
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While the most visible sign of the administration’s war on Minnesota is ICE’s brutal and deadly occupation, it’s not the only way President Trump is attacking the state.
As punishment for the crimes of having a diverse population, not voting for him in three elections straight, and having Tim Walz as governor, Trump has also stripped or withheld billions of dollars, attempting to starve the state of resources. Meanwhile, the state, like all others, continues to pay into the federal government’s coffers.
Like many other blue states, Minnesota pays more to the federal government than it takes in. But why should the state continue to subsidize a government bent on destroying it? What if it just … didn’t?
A few other states have already floated this idea. Legislators in Connecticut, Maryland, New York, and Wisconsin introduced bills to withhold federal payments way back in June of last year. Those bills would authorize the state to withhold federal funding if the state determines that the federal government is delinquent in its funding. States would withhold federal taxes collected from state employees and stop repaying federal grants.
A similar proposal in New York would allow the state to withhold federal taxes from state employee paychecks as well as an amount equivalent to any federal payments being withheld in violation of a court decision. California Gov. Gavin Newsom has said his state might withhold some funds given Trump’s threats to slash billions in funds, but Newsom hasn’t specified what funds or how this would work.
All of these proposals run into the same problem: How, if at all, can a state tell the federal government to pound sand when the taxman comes around?
Could Minnesota do any of these things? As with all law-related questions in the Trump era, the answer is: it’s complicated.
Funding your own occupation
At first blush, the ability of a state to fight back when the federal government has functionally gone to war against it is pretty much zero. That’s not really a function of individual laws or case holdings, but rather is embedded in the Constitution. Stupid Supremacy Clause:
This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.
There’s also the Sixteenth Amendment, which says that “Congress shall have power to lay and collect taxes on income from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”
Dammit.
There are any number of arguments that can be raised to justify not paying federal taxes, most of which tend to make you sound like a sovereign citizen, mumbling about how the Sixteenth Amendment isn’t real or paying taxes is an illegal search and seizure. Red states make a lot of noise about figuring out ways not to pay federal income tax to the tyrannical federal government, though maybe not so much these days.
States have some limited power to resist federal demands thanks to the Anti-Commandeering Doctrine. This is grounded in the Tenth Amendment, which reserves all powers to the states, save those explicitly granted to the federal government by the Constitution. Under this doctrine, the federal government can’t commandeer states into administering federal mandates. The federal government can impose — and pay for and provide personnel and other resources for — federal regulations, but it can’t make states pony up for that.
The patchwork of Medicaid expansion under the Affordable Care Act is based on this doctrine. The Supreme Court’s decision in NFIB v. Sebelius upheld some of the ACA but struck down the provision requiring states to accept Medicaid expansion, even though the federal government was providing substantial funding for states to do so. However, states could lose all their Medicaid funding if they didn’t take the expansion, and the court held that this was too coercive and was essentially commandeering states into following a federal mandate. States could therefore still voluntarily expand Medicaid and take federal funds to do it, but couldn’t be required to do so.
That doctrine may also be effective — well, presuming the Supreme Court actually follows its own past jurisprudence — in stopping the federal government from blocking funds to sanctuary jurisdictions. Immigration enforcement is entirely left to the federal government. Indeed, states are prohibited from making their own state-level immigration laws, which Florida found out earlier this year when the Supreme Court refused to entertain its request to overturn lower court decisions saying just that. If saying that the government can’t yank all Medicaid funding is too coercive — the conservative majority in Sebelius called it “a gun to the head” — then threatening to yank some vast unspecified pool of federal money to states that won’t participate in Trump’s war on immigrants is likely coercive as well.
The problem for Minnesota is that this doctrine is limited to attempts to condition funding on federal action. It provides no protection against the government just taking money away for no reason at all, which is basically what is happening right now. Trump has been slashing money left and right from blue states, something that is all the more maddening given that blue states subsidize red ones by a substantial margin. From 2018 to 2022, blue states paid in roughly 60 percent of federal tax receipts while getting 53 percent back.
Minnesota is one of these “donor” states. In 2023, for example, the state sent $45 billion more to the federal government than what it received in return. Breaking this down another way, per capita, every Minnesotan paid $21,106 to the federal government in fiscal year 2024. California? $20,432. How about those red states? Texas? $13,340. Mississippi? $5,161. You get the picture. Conservative howls about their tax money supporting degenerate blue states are just a lie.
That imbalance is likely getting a lot bigger.
Resistance is possible
Trump used the ginned-up fraud allegations against Minnesota to freeze $10 billion in childcare subsidies and social services payments to Minnesota, New York, California, Illinois, and Colorado, which is not exactly how government funding is supposed to work. Since Congress won’t stop him, though, states are forced to keep fighting this in court. Those states won a temporary reprieve when a federal court blocked the government from doing this, but it isn’t like the administration will stop.
And the attacks on Minnesota, given Trump’s fixation on the state, are relentless.
There was the announcement earlier this year that the USDA would withhold $129 million in food stamp payments thanks to the imaginary fraud, which is currently being challenged in court.
The feds also used a vibes-based fraud argument to tell Minnesota it would be withholding $515 million every three months from 14 Medicaid programs that are “high risk.”
Unspecified, yet extremely racist, fraud allegations were also the explanation for withholding $5.5 million in Small Business Administration funds to Minnesota.
All of these cuts are on top of the ones the administration has been enacting all year, based on his Trump’s personal feelings about what the federal government should pay for. By April, Minnesota was down nearly $300 million thanks to federal funding “pauses” and grant recissions. The administration used the government shutdown to pull back $645 million in energy grants to the state.
By any estimate, the Trump administration has illegally withheld billions of dollars in funds to Minnesota that were authorized by Congress — the body with the power of the purse, not that it seems to care these days.
It’s just pretty tough to find any way forward within existing law. It isn’t really possible for Minnesota to pass a law nullifying some sort of federal requirement in a way that would allow it to withhold funds. Southern states tried to nullify federal tariff laws back in the 1800s, a move that was really just a proxy for figuring out a way to keep slavery alive if the federal government declared it illegal. After Brown v. Board of Education was decided, Louisiana just kept passing laws reaffirming its commitment to segregation, but that was — extremely correctly — ruled unconstitutional.
It’s tempting to say, “Well, so what? Why doesn’t Minnesota just stop paying and see what happens? How much worse can it be, given that the administration is already pulling back billions and occupying the state?”
Sadly, the answer there is actually that it can get much worse. That’s because the federal government has the power to levy property and seize funds for any tax delinquencies, raising the specter of state bank accounts being frozen or drained. If individual taxpayers to refuse to pay federal taxes, they face the same problem.
While normal paths might be foreclosed, there’s something else that remains: symbolic refusal and civil disobedience.
One possible way is for the state to continue requiring taxpayers to still pay all federal taxes, but for the state to serve as a custodian of those funds, not passing them along to the administration. That would protect individual taxpayers from the wrath of the administration, possibly, as they wouldn’t be refusing to pay federal taxes as such.
At root, this is what the other blue state proposals contemplate as well: An individual taxpayer isn’t put at risk because no individual taxpayer is refusing to pay their federal taxes. The state just isn’t passing those funds along.
This method also can’t be attacked as a form of nullification. It doesn’t require the state to pass a law purporting to nullify any federal obligation or tax requirement. It isn’t a weird state sovereignty argument. It’s just a bank account move: the funds are here, and the federal government can have them once they stop illegally attacking the state financially and otherwise.
There’s no telling what the administration would do if this happened. There’s certainly no telling if there’s even an appetite in the Minnesota government to take such a step. But in a world where the federal government has broken the compact of federalism, states have very little incentive to behave as if everything is normal. Resistance is always risky as hell, a long-term project with continuous setbacks, but it’s what we’ve got.
That’s it for today
We’ll be back with a new episode of Nir & Rupar this afternoon and a special Saturday edition tomorrow. If you appreciate today’s PN, please do your part to keep us free by signing up for a paid subscription.
Reminder that in solidarity with the anti-ICE general strike in Minnesota, I am donating all proceeds from today’s newsletter to People over Papers, the Midway-Hamline Diaper Bank, and Every Meal. If you’re not already a paid subscriber but would like to do so and support good causes, please click below and sign up.
Thanks for reading, and for your support.
I like the idea of collecting the taxes but withholding them until they stop committing the abuses. 47 has thrown the constitution out the window. He’s not going to use a constitutional argument to force the States to do anything. Same with the SC. They are twisting and turning the Constitution into a pretzel. Same with Congress. Watching the debate on continuing government funding and the Jack Smith testimony proved that. The bold face bullshit being spewed by the Republican liars yesterday was more proof how deep the swamp goes. Thanks, Lisa and Public Notice. One day at a time is all we can do.🙄
I hope states do take action to withhold taxes —both state and individual—from the federal government. The thought of my dollars supporting the abuses makes me sick and furious!