California voters will cast their ballots on Proposition 40 on November 3. This proposed measure seeks to impose a one-time 5% tax on the wealth of the state’s billionaires. If enacted, it will specifically target individuals who meet the billionaire threshold outlined in the proposal. The initiative arises amid increasing financial pressures in California, particularly concerning funding for healthcare, food assistance, and education.
California is home to as many as 250 billionaires, whose combined wealth is estimated at more than $2 trillion, according to the Reuters report. Proposition 40 would impose the tax only once, rather than creating an annual wealth tax. The measure is also retroactive to January 1, according to Reuters.
Because it could limit the ability of billionaires to avoid the proposed tax simply by moving out of California after the measure passes, this is important.
California also has more billionaires than any other US state , according to a Forbes estimate. The state is home to some of the world’s biggest companies, including Google, Apple, Meta and Nvidia, making California a major center of technology and wealth. The proposal is designed to tax the wealth of billionaires rather than simply taxing their yearly salaries or income.
UC San Diego political science professor Thad Kousser said that although about 60% of Californians reliably vote Democratic in statewide elections, that does not necessarily mean voters have the same views on taxes, government spending or other social issues.
Sergey Brin’s opposition
UC Berkeley economics professor Emmanuel Saez, who helped write Proposition 40, described it as “a tax on billionaires to fund healthcare. Brin has spent more than $100 million opposing Proposition 40 and supporting other measures on the same ballot that would effectively cancel it, according to Reuters. Brin has said his family left the Soviet Union in 1979 and that he does not want California to develop what he described as a similar system. John Pitney, a professor of politics at Claremont McKenna College, said California ballot measures often lose support over time and that being below 50% in August can be a negative sign for a measure’s prospects.
He said billionaires are “no longer very popular. Supporters describe the proposal in simple terms as a way to take a portion of billionaire wealth and use the money to pay for public needs. Supporters argue that California has a very large concentration of billionaire wealth that could be used to raise money for public services. Saez has argued that billionaires have accumulated enormous amounts of wealth and political influence. The opposition campaign has received major financial support from billionaire Sergey Brin, the Google co-founder. The opposition campaign had also not yet fully increased its advertising efforts when the Reuters report was published, meaning the campaign could still change how voters view the proposal.
