In the quiet counting that followed a long midterm night, California settled a question that had gathered the weight of an entire state's conscience: whether those at the very top of its fortunes should be asked to shoulder a share of a burden left by distant federal cuts. Voters said no to Proposition 40, a one-time levy of five percent on the total wealth of residents worth more than 1.1 billion dollars, a measure that would have been a first of its kind anywhere in the world. It fell under the force of billionaire money, the reluctance of a governor nearing the end of his tenure, and divisi
California Voters Reject Proposed One-Time Wealth Tax on Billionaires
Federal healthcare funding cuts in California, tied to President Trump's tax and spending bill, left gaps the tax was meant to fill.
A handful of billionaires even moved out of California to avoid the possible tax.
Mark
So what exactly did Proposition 40 ask of people?
Mimi
A one-time 5% tax on total wealth for Californians worth more than $1.1bn. Shares and other assets counted, not just income. About 200 billionaires live in the state.
Mark
And the money was meant for what?
Mimi
Healthcare. The projected $100bn was to replace federal funding cuts tied to President Trump's tax and spending bill.
Luke
I'd flag that the $100bn is a projection of what it would have raised, not a result. It was never collected, so we can't know how close it would have come.
Mark
Why did it lose, then?
Mimi
Heavy opposition. Sergey Brin reportedly gave more than $100m to a group backing ballot measures to block it, and Governor Newsom and labour unions opposed it too. Democrats were divided.
Luke
Careful with the Brin figure. It comes from the Los Angeles Times as reported by the BBC. It isn't something the BBC independently confirmed. And the reporting says the opposition contributed to the defeat, not that it caused it.
Mark
Newsom's worry was people leaving?
Mimi
Yes. He feared the wealthy would go and take their income tax revenue with them. A handful of billionaires did move out, according to the report.
Luke
Though we don't know how many left because of this measure or what that would have meant for revenue. His concern is a stated fear, not a measured outcome.
Mark
And what comes next?
Mimi
Dave Regan, whose union led the campaign, says he'll seek a billionaire tax again in 2028.
Der Puls
- A nearly week-long vote count finally delivered a verdict: California voters rejected the billionaire wealth tax.
- Proposition 40 would have taxed 5% of the total assets of residents worth over $1.1bn, not just their income, including shares and other holdings.
- Billionaire critics, led by Google co-founder Sergey Brin with over $100m in political spending, poured money into opposing it while some moved out of state.
- Governor Gavin Newsom and labour unions split from the measure's backers, and two competing propositions on the ballot would have undone it even if it had passed.
- With federal healthcare cuts still biting and the state budget gap unfilled, the union behind the measure vows to return with another billionaire tax push in 2028.
In the quiet counting that followed a long midterm night, California settled a question that had gathered the weight of an entire state's conscience: whether those at the very top of its fortunes should be asked to shoulder a share of a burden left by distant federal cuts. Voters said no to Proposition 40, a one-time levy of five percent on the total wealth of residents worth more than 1.1 billion dollars, a measure that would have been a first of its kind anywhere in the world. It fell under the force of billionaire money, the reluctance of a governor nearing the end of his tenure, and divisions within the very movements that had championed it. The gap it hoped to close remains open, and the old argument about fairness, funding and who should pay now waits for another season.
After nearly a week of counting, California has its answer. Voters have rejected Proposition 40, a one-time tax that would have asked the state's billionaires to hand over 5% of their total wealth, including assets like shares and not just income. The state is home to about 200 billionaires, and experts believe the measure would have been the first wealth tax of its kind aimed at billionaires anywhere in the world.
The purpose was concrete. The tax was expected to raise roughly $100bn to offset cuts to federal healthcare funding in California, cuts that flow from President Donald Trump's sweeping tax and spending bill. Backers argued the ultra-wealthy should contribute their fair share toward gaps in the state budget.
Opposition came from many directions. Google co-founder Sergey Brin was among the loudest critics, reportedly giving more than $100m to a political organisation funding ballot measures that could block the tax, and other billionaires spent millions to defeat it. Some moved out of California to avoid a possible levy. Governor Gavin Newsom, whose time in office is ending, also opposed it, worried the wealthy would leave and take their income tax revenue with them, and labour unions were divided too. Two other propositions on the same ballot would have effectively reversed the tax even if it had passed.
Dave Regan, president of the SEIU-United Healthcare Workers West, whose union led the push, said the billionaires' campaign had sown confusion among people who knew in their hearts what was right. He has pledged to bring a billionaire tax back in 2028. For now, the federal cuts remain, the budget gap is unfilled, and the question of how California pays for its healthcare is carried forward into the next fight.
It took nearly a week of counting after the midterm election, but California now has its answer: voters have rejected Proposition 40, a one-time tax on the state's billionaires. The projection came only after the slow tally of ballots in a state with some 23 million registered voters.
The measure would have imposed a 5% tax on the total wealth of Californians worth more than $1.1bn (£800m). That meant not just income but assets such as shares. The state has about 200 billionaires, a group that includes Meta's Mark Zuckerberg, reality television star Kim Kardashian and media mogul Oprah Winfrey. Experts believe that, had it passed, it would have been the world's first wealth tax aimed at billionaires.
The money had a specific purpose. The tax was expected to raise about $100bn to make up for cuts in federal healthcare funding to California, cuts that flow from President Donald Trump's sweeping tax and spending bill. Backers argued the ultra-wealthy should contribute their fair share and help fill the gaps in the state budget.
The opposition was fierce and came from several directions. Google co-founder Sergey Brin was among the loudest critics, and the Los Angeles Times reported that he gave more than $100m to a political organisation funding ballot measures that could block the tax. Other billionaire opponents spent millions trying to crush it, and a handful moved out of California to avoid the possible levy.
The resistance was not limited to the very rich. Governor Gavin Newsom, whose time in office is coming to an end, opposed the measure, as did labour unions. Newsom had voiced concern that it could push wealthy residents to leave, taking their income tax revenue with them. The measure ultimately failed amid divisions among Democrats and within organised labour.
It also faced structural trouble. Two other propositions on the same ballot would have effectively reversed the wealth tax even if voters had approved it, so the odds were stacked against it.
Dave Regan, president of Service Employees International Union-United Healthcare Workers West, whose union led the push, spoke on election night. He said the billionaires' efforts to block the tax produced "a lot of confusion and a lot of second-guessing among people who really in their hearts know what the right thing to do is." He pledged to seek a billionaire tax again in 2028.
The vote carries weight beyond one ballot line. California has the largest economy in the United States and the fourth largest in the world. It has one of the highest concentrations of billionaires anywhere, and also one of the highest wealth gaps. With the federal healthcare cuts still in place and the gap in the state's budget unfilled, the question of how to pay for them now passes to 2028, when Regan's union says it will try again.
Bemerkenswerte Zitate
The billionaires' efforts created a lot of confusion and a lot of second-guessing among people who really in their hearts know what the right thing to do is.— Dave Regan, president of SEIU-United Healthcare Workers West
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