Full Breakdown
California Imposes 25% Tax on Private ICE Detention Facilities
By Drooid · · How we work
Core Event
Governor Gavin Newsen signed Assembly Bill 1633, a law that levies a 25 percent tax on the gross income of any private detention center that contracts with Immigration and Customs Enforcement (ICE) in California. The tax applies to federal, state and local contract recipients and is slated to take effect on July 1, 2028. Revenue will be deposited into a “Due Process for All Fund” designated for immigration-related services.
Background & Context
The measure is framed by Newsom as a counter-measure to President Donald Trump’s immigration crackdown and the broader trend of privatizing federal enforcement. By targeting the profitability of private detention operators, the governor aims to pressure the federal government to rely less on private facilities in the state.
Data & Statistics
- California hosts eight ICE detention facilities, all privately operated.
- Ownership breakdown: five facilities are owned by the GEO Group, one by Imperial Valley Gateway Center LLC, and two are operated by CoreCivic under contracts extending to 2027 and 2029.
Official Statements & Responses
- Newsom’s press release emphasized that if private facilities cannot be eliminated, the state will target their profits: “If we can’t kick out private facilities, we’ll go after their profits.”
- Hans von Spakovsky, senior legal fellow at Advancing American Freedom, argued the tax’s purpose is to make California’s private detention market unattractive to the federal government and warned the government may turn to federal properties it cannot tax or to neighboring states such as Arizona or Nevada.
Conflicting Reports & Gaps
No source provides a definitive estimate of how the tax will affect ICE’s overall detention capacity or the fiscal impact on the state’s budget. Projected consequences remain speculative, with analysts offering differing views on whether the tax will meaningfully reduce private detention use or simply shift costs elsewhere.