California voters face a historic one-time wealth levy

California residents will vote on November 3 on a proposal to impose a one-time five percent tax on the net worth of every billionaire residing in the state. The measure, known as Proposition 40, targets a group of slightly more than 200 ultra-wealthy individuals, including prominent figures such as Oprah Winfrey, Mark Zuckerberg, Kim Kardashian, and George Lucas. If passed, the levy would serve as a significant attempt to address funding gaps in the state's medical infrastructure.

Advocates for the measure argue that it will generate approximately 100 billion dollars in revenue. This funds would be used to offset federal budget reductions affecting California's healthcare system, a consequence of the broad tax and spending legislation enacted by President Donald Trump. Suzanne Jimenez, who helped lead the campaign for the proposal through Service Employees International Union-United Healthcare Workers West, described the plan as a temporary fix. She noted that without this action, the state risks a collapse of its medical services while a more permanent funding strategy is developed.

California possesses the largest economy of any US state and ranks as the fourth largest globally, surpassing nations like India and the United Kingdom. Despite this economic power, the state also has the highest number of homeless residents in the country and one of the widest disparities in wealth. Francesco Trebbi, a public policy professor at the University of California, Berkeley, believes this is the first tax specifically targeting such an extreme segment of the wealth distribution.

Opposition to the measure is led by Governor Gavin Newsom, whose term in office is concluding. He cautions that the tax could incentivize wealthy residents to relocate, thereby reducing the state's income tax base. Google co-founder Sergey Brin has reportedly donated over 100 million dollars to a political group funding ballot initiatives that could block the proposal. A September poll conducted by the Los Angeles Times and the Berkeley Institute of Governmental Studies showed that 45 percent of likely voters support the measure, 42 percent are opposed, and 13 percent remain undecided. A simple majority is required for the proposal to pass.

Should voters approve the measure, the tax would apply retroactively to anyone with a net worth of at least one billion dollars who resided in California as of January 1, 2026. At least six billionaires have reportedly already left the state. Among them are Google co-founders Larry Page and Sergey Brin, venture capitalist Peter Thiel, former Uber CEO Travis Kalanick, and Hankey Group founder Don Hankey. Hankey told Forbes that he moved to Nevada because the proposal made him feel unwelcome despite the jobs his companies created.

Meta chief Mark Zuckerberg informed the company's board last month that he was considering moving his primary residence out of the state. Meta, which is headquartered in California, agreed to a new stock agreement granting him additional shares to offset the billions in taxes he might owe, which could reach as much as 12.5 billion dollars. Andy Fang, co-founder of DoorDash, called the measure "stupid".

Conversely, some billionaires support the tax. Nvidia chief Jensen Huang told CBS, the BBC's US partner, that he does not mind paying taxes and that higher earners should pay more. Senator Bernie Sanders addressed a Los Angeles rally, stating that billionaires believe they have a God-given right to rule and predicting that voters would deliver a powerful lesson on November 3.

California is not the only state considering such measures. Washington state voters are weighing a nine point nine percent tax on income exceeding one million dollars annually. Wealth taxes were once more common in Europe, though only Spain, Norway, and Switzerland retain them today. Kristian Niemietz of the Institute of Economic Affairs described such levies as more trouble than they are worth.

US inequality has reached levels not seen in over three decades, with the top one percent of households holding nearly 32 percent of the nation's wealth in the third quarter of 2025. According to the Public Policy Institute of California, 72 percent of residents believe the gap between the rich and poor is widening, and a similar share thinks the state government should act. Trebbi said the measure is driven by anti-elite sentiment and is less about the specific proposal than it is about an effort to re-balance the economic scale.