California voters fail to pass proposed one-time tax on billionaires’ wealth
California voters have rejected Proposition 40, a proposed one-time 5% tax on individuals with a net worth exceeding $1bn, effectively defeating the measure.
The campaign for Proposition 40 was the most expensive in California's history, costing billions of dollars and drawing intense scrutiny.
Sponsored by the healthcare union SEIU-United Healthcare Workers West, the measure sought to raise funds for healthcare programs, education, and food assistance.
Supporters argued the tax was a necessary response to drastic healthcare cuts mandated by the One Big Beautiful Bill Act.
This result could hamper nationwide momentum on demands that billionaires pay their fair share and states enacting new laws to tax the ultra-wealthy.
Billionaire opposition
The opposition campaign was led by the state's billionaires, who spent nearly $425m to defeat the measure.
The most prominent donor was Sergey Brin, a Google co-founder, who contributed at least $132m to the cause.
Other major donors included executives from Google, Palantir, DoorDash, Stripe, and Reddit, along with several venture capitalists.
Opponents argued that the tax was an "everyone tax" and would not be effective.
Counter-measures and defeat
The billionaire opposition mounted two separate counter-measures on the ballot, Proposition 41 and 42.
Proposition 41 directly targeted the billionaire tax, while Proposition 42 proposed to ban any taxation on billionaire wealth.
Supporters of the billionaire tax called Props 41 and 42 "poison pills".
The defeat of Prop 40 marks a significant setback for progressive efforts to tax the ultra-wealthy.
Related
