Billionaire Wealth Tax Headed to the California Ballot

Gov. Gavin Newsom, who opposes the tax, tried to intimidate proponents into pulling the measure. It didn’t work.

https://prospect.org/2026/06/26/billionaire-wealth-tax-headed-to-california-ballot/


California Gov. Gavin Newsom has unsuccessfully sided with billionaires in the debate over a ballot measure that would create a one-time wealth tax in his state. Credit: Godofredo A. Vásquez/AP Photo

Sponsors of a ballot measure in California that would place a one-time 5 percent tax on the wealth of the state’s billionaires, raising approximately $100 billion to offset devastating federal cuts to health care for the next five years, announced on Thursday that they would go forward to the statewide ballot this November. The announcement came despite fierce opposition from, well, billionaires, as well as Gov. Gavin Newsom, who has sided with the 250 richest people in California and will now have to decide if becoming the public face of opposition to a tax on billionaires is something he wants to do before running for president in 2028.

Voters will also see two rival measures that would nullify the billionaire tax; they were funded by Google co-founder Sergey Brin and qualified for the ballot earlier this week. Under the rules guiding direct democracy in the state, in the event of competing initiatives, the successful proposition with the most votes would become state law. Thursday was the last day that initiatives could be withdrawn in California, under a system that allows sponsors to negotiate with the legislature to either place substitute language on the ballot or arrive at a legislative solution. Neither side opted to do so. “We are confident we will win,” said Debru Carthan, vice president of the Service Employees International Union-United Healthcare Workers West (SEIU-UHW), which represents 120,000 health care workers in the state and proposed the ballot measure.

The union has said that a wealth tax was the only solution anyone has proposed to avoid ER and hospital closures, a loss of coverage for 3.2 million residents, higher premiums, deductibles and co-pays for another 20 million, and 150,000 lost health care professional jobs. Medi-Cal, the state version of Medicaid, would see the lion’s share of the cuts. “Gov. Newsom has no plan,” said Carthan at the press event. “He has no plan to stop emergency rooms from closing. He has no plan for your health care costs. He has no plan to make sure that your family doesn’t have to drive further and wait longer to get medical care.”

Opponents argue that the wealth tax would cause capital flight from the state, though it is based on residents as of January 1 of this year, and therefore any billionaires who left after the tax passed would still have to pay. California’s tax code is distorted and heavily dependent on receipts from wealthy individuals, so any capital flight could reduce regular revenues, opponents have said. If successful, the measure would create the first wealth tax in the nation, albeit a temporary one. The surge of capital income and inequality over the past few decades has hived off trillions of dollars from taxation, as the wealthy use elaborate accounting strategies to keep their wealth out of reach.

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