- Proposition 40 would impose a one-time 5% tax on roughly 200 California billionaires.
- Google co-founder Sergey Brin moved to Nevada to dodge the tax. He’s spent $102 million fighting it. His estimated tax bill if it passes: $13 billion.
- The measure has split Democrats. Gov. Gavin Newsom endorsed a permanent ban on wealth taxes.
A proposed one-time tax on the state’s billionaires will be featured on California’s ballot this Nov. 3, creating tension in the Democratic Party, and prompting billionaires to move out of state.
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Proposition 40 would enact a one-time tax of 5% on the covered assets of California residents and trusts with a net worth over $1 billion as of Jan. 1.
If passed, Prop 40 would be the country’s first wealth tax on billionaires.
The money raised from the tax would go into the Billionaire Tax Reserve Fund, and would then be funneled primarily into health spending, with 90% earmarked for that purpose, while the other 10% would go toward education and food assistance, according to information on Ballotpedia.
Prop 40 was sponsored by the Service Employees International Union-United Healthcare Workers West and is supported by Sen. Bernie Sanders, I-Vermont, California Democratic Socialists of America and U.S. Rep. Ro Khanna, who represents Silicon Valley.
Leading the opposition campaign is California Gov. Gavin Newsom, the California Teachers Association, Planned Parenthood and nearly all Republicans.
How the billionaire tax was born
Dave Regan, president of SEIU-UHW, “wanted to raise $100 billion to address looming federal healthcare cuts,” reported The Sacramento Bee. He thought the best way to do that was to impose a one-time billionaire wealth tax.
Regan met with professors across the country to develop ideas and draft the proposition. However, according to ABC 7 News, SEIU California filed charges against him, “alleging a pattern of bullying, extortion and threats.” This resulted in him stepping back from the project.
UC Berkeley economist Emmanuel Saez, one of the authors, said the proposition is about taxing the rich. He said, “They hate the fact that the thing is called a billionaire tax because already, that gives us a tremendous advantage — if people just understand that simple point.”
A Manhattan Institute poll showed only 35% support for California’s Prop 40, compared to 50% who are opposed.
Manhattan Institute poll | 9/24–10/1 LV
California Prop 40, the billionaire tax
❌Oppose 50%
✅Support 35% https://t.co/gFjO5n0XO8 pic.twitter.com/2tWZIhmkpz— Politics & Poll Tracker 📡 (@PollTracker2024) October 9, 2026
Who’s backing the tax
Sanders recently held a “Yes on 40” rally in Los Angeles and told the crowd, “The whole country is watching what you are doing here, and why it is so imperative that we win this struggle.”
“They have all the wealth; they got all the power,” referring to the billionaires in California. “Well, I think on Nov. 3 they’re going to learn a very powerful lesson,” Sanders said during the Oct. 5 event.
In an X post in September, Sanders called out billionaires who have opposed Prop 40. He said “It is also being opposed by Mark Zuckerberg, Larry Page, Larry Ellison, Eric Schmidt and Peter Thiel,” as well as Sergey Brin, the co-founder of Google. “These 5 Big Tech billionaires are worth over $646 billion combined.”
California’s Billionaire Wealth Tax: Healthcare vs. Greed
On November 3rd, at a time of unprecedented income and wealth inequality, the people of California will decide whether to pass a 5% wealth tax on more than 200 billionaires in California who are worth $2.2 trillion.…
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— Bernie Sanders (@BernieSanders) September 24, 2026
SEIU-UHW’s website offers Californians a chance to join the movement of the proposition. It states, “Momentum is building for Prop. 40. The billionaires think they can fool us, but millions of Californians are about to prove them wrong.”
The healthcare union also released a statement addressing personal attacks and the lawsuit Regan received ahead of the Prop 40 vote.
The statement said, “The billionaires think people are stupid. They got big tax breaks. Californians got big healthcare cuts. The billionaires pay lower tax rates than the rest of us and are willing to do almost anything to avoid paying their fair share.”
Billionaires respond
In December 2025, Brin purchased a mansion by Lake Tahoe and listed Nevada as his home state after Prop 40 was initially filed that October.
Brin is currently listed as the fifth richest person in the world with a net worth of $266.9 billion. If Prop 40 is passed, his estimated tax liability — if he were deemed a California resident— would be $13.3 billion.
By Jan. 12, Building a Better California, a political group founded and funded by Brin, had filed Prop 42, an alternative to Prop 40. Ballotpedia said this proposition “would prohibit taxes enacted by law or constitutional amendment on or after Jan. 1, 2026, on the ownership or control of retirement holdings, individually owned assets, and other forms of personal savings,” directly blocking Prop 40.
Brin donated $102 million to Building a Better California. Its website states its mission is to, “improve affordability and quality of life for all Californians, while ensuring the state remains a center of innovation, good-paying jobs, and economic opportunity.”
Why Democrats are divided
UC Berkeley’s economist Enrico Moretti, said a state wealth tax may cause more harm than good. “These billionaires are not going anywhere; they’re just going to a different state, and my concern is that they’re bringing with themselves a lot of the jobs that could have been in California.”
He said, “It just strengthens the economy of red states and weakens the economy of the most progressive blue state.”
On Oct. 9, Newsom endorsed Proposition 42, opposing the proposed billionaire wealth tax.
Earlier this year, Newsom said that wealth should be taxed at the federal level, not the state level. He said, “The good news is the overwhelming opposition to this by others,” and, “I think it will be defeated, because I think people understand what it does versus what it promotes to do.”
Jodi Hicks, CEO of Planned Parenthood’s California Chapter, aligned with Prop 40’s opponents. She said Prop 40 was “poorly written and would provide only a one-time revenue boost at a time when California needs ongoing funding.”
“We just believe this proposal is seriously flawed and could do more damage than good,” she said.
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