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California voters reject tax on net worth of billionaires
California voters have rejected Proposition 40, a proposed first-of-its-kind tax on billionaires’ net worth. Its defeat is a victory for Democratic leaders who opposed the measure, including Governor Gavin Newsom, while leaving unresolved the debate over taxing the ultra-rich to help fund public services.
The proposal would have imposed a one-off 5% tax on Californians worth more than $1 billion, with most proceeds intended to offset federal healthcare funding cuts and 10% allocated to education and food assistance. The campaign against it raised about ten times as much as supporters, including more than $100 million from Google co-founder Sergey Brin; the opposing committee raised over $333 million. The article says younger voters were more supportive, while roughly seven in ten voters aged 65 and over opposed it.
In short
- California voters rejected a proposed 5% tax on billionaires’ wealth.
- Opponents raised about ten times more than supporters.
- Supporters say they may put a tax back on the ballot in 2028.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Supporters could argue that an exceptional, one-off levy on billionaires is a fair way to ask those with the greatest ability to pay to help protect healthcare, education and food assistance, particularly as federal funding is cut. They may also see it as a way to address concentrated wealth while directing most of the proceeds towards public needs.
The case against
Opponents could argue that taxing net worth rather than income risks penalising assets that may be difficult to value or sell, and that a one-off levy could prompt wealthy residents to move or shift assets, weakening future revenues. They may also question whether the state should rely on an unusually large tax to fill gaps in federal funding, rather than pursue more predictable funding arrangements.