California billionaire tax Proposition 40 defeated, Digi Mart USA News (California, USA): A proposed wealth tax on California’s super-rich has been rejected in a statewide referendum, after a heated campaign in Silicon Valley. Billionaires around Google co-founder Sergey Brin reportedly mobilized more than $300 million for a campaign against the so-called billionaire tax, filling television airtime with their advertisements.
The measure, listed as “Proposition 40,” received only 47.2 percent of the vote and missed the majority needed, the Associated Press reported based on vote counts.
Under the proposal, every California resident with a fortune of at least $1 billion as of January 1, 2026, would have been required to give up five percent of that wealth once. The money was largely intended for the state’s health care system, which supporters said faced funding gaps due to the loss of grants from the Republican-led federal government in Washington.
Supporters hoped the levy would raise $100 billion over five years for the struggling health care sector, although researchers at Stanford University estimated revenue closer to $30 billion.
Left-leaning politicians such as Bernie Sanders backed the new levy, as did some labor unions. Within the Democratic Party, however, leaders were deeply divided.
Democratic Governor Gavin Newsom reportedly feared that billionaires could leave the state, eliminating the tax revenue altogether. Democratic successor candidate Xavier Becerra also opposed the measure.
Those concerns were not entirely unfounded, as some of California’s wealthiest residents have already taken steps to change their official residences. Brin and fellow Google co-founder Larry Page reportedly acquired properties in Florida worth tens of millions of dollars, a Republican stronghold.
Meta chief executive Mark Zuckerberg took a different approach, pushing through a new share structure at the Facebook parent company with a threat to relocate. Through a stock split, new shares without voting rights would be issued, which would allow Zuckerberg to sell part of his holdings to pay the tax without losing influence.
Nvidia chief executive Jensen Huang, who has been in the headlines over an affair with an alleged Chinese spy, said that leaving California because of the tax was out of the question for him.
The levy was also meant to address the problem that wealthy Americans can easily avoid tax payments. Their fortunes often consist of large stock holdings, on which taxes would only become due when shares are sold.
Instead, they frequently take out loans secured by their stock and can live largely tax-free. Supporters pointed out that about 250 billionaires with a combined fortune of roughly $2.3 trillion live in California.
