Proposition 40 would collect $100 billion from California's 200 billionaires
The one-time 5% net worth tax aims to offset federal cuts, though a majority of likely voters has not yet formed.
By Andre Williams ·
California voters will decide in November whether to collect $100 billion from the state's wealthiest residents.
Proposition 40 proposes a one-time 5% tax on the net worth of every individual in California with assets exceeding $1 billion. The state is home to just over 200 billionaires, including Oprah Winfrey, Mark Zuckerberg, Kim Kardashian, and George Lucas.
Supporters argue the levy is necessary to cover federal funding cuts to the state's healthcare system resulting from the national tax and spending bill. Suzanne Jimenez of Service Employees International Union-United Healthcare Workers West described the measure as a short-term solution to prevent a healthcare collapse while longer-term funding strategies are developed.
Governor Gavin Newsom, whose term is ending, opposes the tax. He warns it could drive wealthy residents and their associated income tax revenue out of the state. Sergey Brin, a Google co-founder, has donated more than $100 million to a political organization funding ballot measures that could block the proposal.
A September poll by the Los Angeles Times and the Berkeley Institute of Governmental Studies found 45% of likely voters in favor and 42% opposed. Thirteen percent remained undecided. A simple majority is required for passage.
The tax would apply retroactively to anyone worth at least $1 billion who lived in California on January 1, 2026. At least six billionaires have reportedly left the state, including Google co-founders Larry Page and Sergey Brin, venture capitalist Peter Thiel, former Uber boss Travis Kalanick, and Hankey Group founder Don Hankey. Hankey told Forbes he moved to Nevada because he felt unwelcome despite the jobs his companies created.
Mark Zuckerberg told Meta's board last month he was considering moving his primary residence out of California. The company agreed to a new stock deal to give him additional shares to offset the potential loss. He could owe as much as $12.5 billion. DoorDash co-founder Andy Fang called the measure stupid.
Other billionaires support the levy. Nvidia chief Jensen Huang told CBS that he does not mind paying taxes and accepts that higher income leads to higher tax liability. Senator Bernie Sanders told a Los Angeles rally that billionaires believe they have a God-given right to rule and predicted they would learn a powerful lesson on November 3.
Source: BBC News
