California ‘billionaire tax’ makes ballot despite opposition from tech moguls | California
A popular proposal to impose a wealth tax on billionaires in California has garnered enough signatures to get on the ballot in November, state officials announced Wednesday.
The news will intensify an already heated debate over the tax that has pitted tech moguls and the state’s governor, Gavin Newsom, against the labor union that supports the measure.
The California Billionaire Tax Act, colloquially known as the billionaire tax, would impose a one-time 5% tax on any California resident worth more than $1 billion. The proposal is supported by the Service Employees International Union-United Healthcare Workers West (SEIU-UHW) as a means to fund California’s struggling health care, Food aid and education programs.
The proposal has become one of the biggest political flashpoints in the state. While it gained popular momentum throughout the year, it also galvanized prominent billionaires like Google co-founder Larry Page and Meta co-founder Mark Zuckerberg. is making moves to cut ties with the state, and Newsom is promising to prevent the state from going to a vote. Although enough signatures had been collected for a vote, the coalition supporting the measure It will be decided by June 25 whether to proceed or potentially reach an agreement.
Late Thursday, the Billionaire Tax Now Coalition, a group led by SEIU-UHW, sent a message. letter He called on Newsom to support a modified 2% wealth tax on the state’s billionaires.
“A one-time 2 percent tax on this accumulated wealth is a modest tax by any objective measure, especially if it means keeping emergency rooms open and patients’ lives saved,” the letter reads. “This is more than appropriate at a moment when Sacramento is asking all other Californians to make sacrifices.”
While SEIU-UHW framed the proposal as a way to ensure the ultra-rich pay their fair share, many of the state’s tech elite have decried the tax and spent millions to crush it. Google co-founder Sergey Brin alone spent at least $82 million on tax-fighting efforts and moved to the Nevada side of Lake Tahoe, just over the California border.
Palantir co-founder Peter Thiel and former Google CEO Eric Schmidt Crypto billionaire Chris Larsen and DoorDash CEO Tony Xu are among other tech moguls donating millions to oppose the tax. California has the most billionaires of any state (more than 200), and many of them have increased their wealth in recent years amid the AI boom.
Nvidia’s billionaire CEO Jensen Huang, in particular, said he was happy with the proposed tax and chose to live in Silicon Valley. during a to talk “I tell everyone: ‘Move to California. Don’t leave,'” he said at the Stanford Graduate School of Business in April. “It’s the highest tax in the world, but that’s OK.”
battle lines
The proposed billionaire tax began gaining momentum at the beginning of the year as the campaign tried to collect enough signatures for the November ballot. In late April, SEIU-UHW announced that it had already collected more than 1.55 million signatures; That’s more than twice the amount required, and the union pointed to that figure as evidence of the proposal’s popularity.
On Thursday, the union announced it can now officially move forward with the November election.
“With today’s news, David has won the runoff against Goliath, but healthcare workers and our allies will not give up until we protect patients from the California healthcare collapse engineered by Trump and Congress,” said Debru Carthan, a spokeswoman for the billionaire Tax Now coalition.
The next step will be for California’s secretary of state to approve the measure by June 25, which would set the measure up for official approval for November. However, SEIU-UHW has the option to withdraw this before next week. This is where a potential deal comes into play.
Newsom has long vowed to fight the measure. He has consistently opposed such state-level wealth taxes and said they “drag the race to the bottom”, his spokesman told the Guardian in January. He publicly said the tax would drive billionaires out of California and strip the state of revenue. Newsom is reportedly trying to form a coalition help him make a deal with the union.
“From the beginning, SEIU-UHW designed this measure as a ‘gun behind the door’ to negotiate a better deal,” said David McCuan, a political science professor at Sonoma State University who studies the California ballot measure process. “The goal was to threaten to go to war rather than go to the ballot box and go nuclear on a ballot measure war that could cost hundreds of millions of dollars.”
SEUI-UHW looks ready to come to the table with a proposal to reduce the tax from 5% to 2%. In its letter to Newsom, the billionaire Tax Now Coalition frames this moment as a test of leadership.
“Governor Newsom, you have taken bold action in the past when California needed it,” the coalition wrote. “This is one of those moments. The demand is clear. The timeline is tight but achievable. And the payoff is real and immediate, preventing widespread hospital and health center closures and saving patients’ lives.”
Multiple local unions and lawmakers, including California congressman Ro Khanna, have joined the coalition to support the billionaire tax, but powerful organizations in the state have also stepped in to oppose it. These include the California Teachers Association, the California State Building and Construction Trades Council, the California Medical Association, and Planned Parenthood Affiliates of California.
That makes the capitol negotiations important, McCuan said, adding that this isn’t Newsom’s first time getting involved in voting campaigns. The governor helped in 2024 set aside many high-profile measures Those eligible for the November ballot include issues such as employer liability, child welfare and oil drilling.
“Let’s see if the magic can be unlocked this time,” McCuan said, warning that the political climate is different this year as November becomes “the mother of all midterms.”
“The stakes are much higher this time,” he said.
The governor’s office declined to comment.
