California Candidate promises $100K tax break—Critics warn of $100 Billion budget hole

Sacramento, California – Republican gubernatorial candidate Steve Hilton is making waves in California politics by proposing a bold plan to eliminate state income tax for residents earning under $100,000. Hilton, a former adviser to U.K. Prime Minister David Cameron and longtime Fox News host, entered the 2026 governor’s race in April with a campaign focused on revitalizing the Golden State’s economy and quality of life.

Under Hilton’s proposal, the first $100,000 of income for all Californians would be exempt from state income tax. He argues the policy would attract new investment, boost job creation, and relieve financial stress for working families.

“This is the quickest and simplest way of bringing some relief to people,” Hilton told The San Francisco Chronicle. “It would accelerate our rate of growth so the jobs are created, making California a more attractive place for people to invest.”

California’s progressive income tax system currently generates approximately $100 billion annually—over 40% of the state’s total revenue. Critics argue that removing such a large portion of tax income would have dire consequences for public services and infrastructure. Chris Hoene, executive director of the California Budget and Policy Center, cautioned against rash fiscal changes. “Big promises are easy to make, but the tax system and government programs are intricate and carefully crafted,” Hoene said. “Rash decisions lead to complications, mistakes, and real harm.”

Hilton, who became a U.S. citizen in 2021, launched his campaign with the slogan “Golden Again: Great Jobs, Great Homes, Great Kids.” In an interview with The Times, he said, “California is an iconic state. It represents everything we think of as the greatest virtues of American innovation and ambition… We can’t just tolerate this slow decline.”

Implementing Hilton’s proposal would face significant legal and political hurdles. Because California’s current high-income tax brackets were enshrined in the state Constitution via Propositions 30 and 55, changes to those laws may require voter approval through a ballot measure.

Still, Hilton believes the time is ripe for bold ideas, citing rising costs of living and stagnant economic opportunity. “Thirty-five percent of Californians today cannot afford to meet their basic needs for rent, food, [and] medical care,” he said. “That is how bad it has got.”

Hilton joins a crowded 2026 race that includes high-profile Democrats such as Eleni Kounalakis, Antonio Villaraigosa, Toni Atkins, Tony Thurmond, and Betty Yee. Speculation also continues around a potential bid from Vice President Kamala Harris.

Whether Hilton’s tax proposal will gain traction in deep-blue California remains to be seen—but it’s already sparking debate.