In brief
California voters are about to decide on Proposition 40, a one‑time 5% wealth tax on all state residents whose net worth exceeds $1 billion. The measure could raise roughly $100 billion to cover cuts to the state’s Medicaid program, but it has divided lawmakers and the ultra‑wealthy, some of whom have already begun moving out of the state. Supporters, including CEO Jensen Huang and Vice President Bernie Sanders, argue it levels the playing field, while opponents such as Senator Gavin Newsom and Google co‑founder Sergey Brin fear it will drive talent away. A recent poll shows the vote could be very close, with 45% in favor, 42% opposed and 13% undecided.
California, home to the world’s richest, is about to put a 5 % wealth tax on billionaires on the ballot.
Proposition 40, a one‑time levy on the net worth of any resident with a fortune above $1 billion, could raise roughly $100 billion to close the gap left by federal cuts to the state’s Medicaid programme.
The measure has split the political spectrum and the ultra‑rich. Senators, state leaders and some billionaires like Nvidia CEO Jensen Huang back it for “progress, while Governor Gavin Newsom and Google co‑founder Sergey Brin fear it will drive talent and revenue out of California.
A recent poll from the Berkeley Institute of Governmental Studies and the Los Angeles Times shows 45 % of likely voters favour the tax, 42 % oppose and 13 % are undecided — a razor‑thin margin that could swing on turnout.
The bill could also see the biggest retirees in the state, including Meta founder Mark Zuckerberg and venture‑capitalist Peter Thiel, moving to other states to avoid the levy. California’s wealthiest may be forced into a $12.5 billion net‑worth tax if the measure passes, according to recent estimates.
Supporters say the tax is a “short‑term solution” to the crisis created by President Donald Trump’s sweeping tax cuts and a way to enforce fairness. Opponents argue it would stifle investment, encourage capital flight and ultimately raise less revenue than projected.
The measure will be on the November 3 ballot, and California voters will decide if the state is ready to be the first in the world to tax its billionaires.
