Gov. Gavin Newsom’s final budget as California’s leader has been shored up temporarily by a recent Trump administration policy decision, but it will still likely leave his successor facing a fiscal cliff.
California and several other states have relied on a complex tax to draw on more federal funding for Medicaid—a practice targeted in President Donald Trump’s major tax law last year.
The Center for Medicare and Medicaid Services issued guidance Jan. 29 allowing states to keep their current taxes in place through the end of 2026, ensuring funds from the levy will continue to flow through the year.
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