California voters will decide whether the state’s billionaires should face a 5% net-worth tax in November after Gov. Gavin Newsom’s (D-CA) opposition to the idea failed to stop it from getting on the ballot.
The ballot measure will decide if the state should impose a one-time 5% tax on its billionaire residents, an idea that has been controversial within the Golden State and among members of the Democratic Party. The state, home to major money-making industry hubs such as Silicon Valley and Hollywood, has over 200 billionaires who would be forced to cough up the one-time wealth tax, provided they lived in the state as of Jan. 1, 2026.
The idea was championed and lobbied for by the Service Employees International Union, United Healthcare Workers West. The SEIU argued that what it has branded an “emergency” tax will make up for the federal cuts to rural California healthcare made by the One Big Beautiful Bill Act. If passed, the state would direct 90% of the revenue from the tax to the state’s healthcare system and the other 10% to public education and food assistance programs.
However, while backed by liberals such as Rep. Ro Khanna (D-CA) and Sen. Bernie Sanders (I-VT), the measure has drawn criticism from both Democrats and Republicans alike. Critics have raised red flags that the measure could be the impetus for industry heads to leave the state, where taxes are already notoriously high, out of fear that another “one-time” billionaire tax could happen again.
Newsom has been against the measure since the SEIU branch began advocating it, unwilling to compromise for a lower percentage on the tax, as he maintained he wanted no tax at all. The impasse in negotiations between the state’s executive branch and the union led to the tax proposal making it to the ballot when this week’s deadline hit.
The state’s GOP gubernatorial candidate Steve Hilton, who is backed by President Donald Trump, called the measure “something that just captures so perfectly the stupidity and the failure of 16 years of one-party rule.” Democratic candidate Xavier Becerra is also against the proposal.
“Billions of dollars of actual revenue have already left,” Hilton said. “It’s gone. It’s too late.”
But Dave Regan, president of the union, said the opponents of the measure are “totally out of touch.” He told Politico that Newsom’s opposition shows he is “in lockstep with the 250 billionaires in California.”
However, with the measure now on the ballot, Newsom is changing his tune and calling for a national billionaire’s tax, saying he is opposed to California’s because he did not agree with the method of one stakeholder calling the shots on the state’s budget. He confirmed he will be voting no on the state’s ballot measure.
“The fight belongs at the federal level, where this broken system was created in the first place,” Newsom wrote in a Substack post. “So here is what I support: A national billionaires’ tax. A true minimum tax on billionaires — a modern Buffett Rule — that ensures the people at the very top pay at least the tax rate their own workers pay.”
NEWSOM REJECTS SCALED-BACK BILLIONAIRES TAX AS BALLOT FIGHT LOOMS
Voters in California will weigh in on this ballot measure, along with 13 others, on Nov. 3.
Some of the state’s most prominent billionaires include Meta’s Mark Zuckerberg, Oracle’s Larry Ellison, and Nvidia’s Jensen Huang.