Matt Mahan Proposes EV Tax to Offset California Gas Tax Suspension

San Jose Mayor Matt Mahan, a 43-year-old moderate Democrat and former tech executive, has proposed a tax on electric vehicle owners alongside higher-income earners to offset a temporary suspension of the state's gas tax amid rising fuel prices. Mahan made the proposal for the first time during a CNN debate on May 6, 2026.

"We need to reform this tax and make sure EV owners and higher-income owners are paying their fair share," Mahan said in the debate. He added that he grew up in a farming town and understands the burden a dollar increase in gas prices places on families forced to choose between rent and food.

Mahan entered the race in January and has centered his campaign on criticizing the state's handling of homelessness, crime and affordability. He has positioned himself against both Republican "MAGA values" and what he calls "more of the same" from longtime Democratic leaders.

Mahan is the only major Democrat calling to suspend the gas tax and wants to tie future pay raises for state officials to measurable improvements in unemployment and homelessness. His campaign website emphasizes immediate relief for working families through the gas tax suspension.

Mahan has raised more than $12 million in recent weeks for his campaign committees. Independent expenditure groups backed by tech figures have spent more than $18 million to support him. Donors include Google co-founder Sergey Brin, venture capitalist Michael Moritz and Reddit CEO Steve Huffman.

Some, including Brin and Palantir co-founder Joe Lonsdale, have also contributed to Republican candidate Steve Hilton. Mahan's campaign has highlighted his experience in tech, including co-founding an early Facebook app and a voter network, as well as his work as mayor creating a coalition of more than 900 public agencies to explore responsible artificial intelligence use in government.

Mahan has said he supports taxing AI companies to fund workforce development. "Voters can see past the kind of, you know, shallow connection that because I’m the mayor of the largest city in Silicon Valley, that might mean that I’m not willing to regulate tech," Mahan told The Associated Press.

He has defended his record, noting he defeated a labor-backed candidate for mayor in 2022 and implemented policies directing more funding to short-term housing while allowing arrests for those rejecting shelter offers. San Jose saw a drop in unsheltered homelessness last year according to county data.

He has also backed a tough-on-crime ballot measure and recently tempered criticism of Newsom, saying the governor has focused on the right issues.

Lorena Gonzalez Fletcher, president of the California Labor Federation, which has endorsed other candidates, said a Silicon Valley mayor would not stand up to big tech and AI billionaires. "People do not want somebody who is a puppet of these big tech billionaires, of these AI billionaires — and that’s who he has always been," Fletcher stated.

Polls reflect a chaotic and fluid race with four candidates emerging as leaders in the primary to replace Newsom. Mahan has argued that support for his rivals remains soft and that many voters are still persuadable even if currently leaning elsewhere.

He told a Reddit "Ask Me Anything" session that he plans to win outright rather than drop out to avoid a scenario in which two Republicans advance to the November general election.

Porter, the only woman among leading Democratic contenders, has seen her campaign stalled by scrutiny over viral videos showing heated outbursts, including one telling a staffer to "get out of my f---ing shot" during a video call. She released a campaign ad this week that pokes fun at the incidents while grocery shopping, filling her car with gas and referencing her adult child, while also taking aim at President Donald Trump.

Porter has sought to reassure voters about her temperament as early voting begins ahead of the June 2 primary.

The debate also featured pointed attacks on former Health and Human Services Secretary Xavier Becerra, who has risen quickly in polls. Billionaire Tom Steyer is largely self-funding his campaign and drew a direct rebuttal from Mahan when he proposed higher corporate property taxes. "Raising taxes isn’t always the answer, Tom," Mahan said during the exchange.

California has long balanced policies that both promote and regulate its tech industry. Independent groups backed by tech companies and billionaires have committed at least $40 million to influence California legislative races this cycle in addition to the gubernatorial contest.