California voters consider $100 billion billionaire wealth tax to fund healthcare
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A statewide proposition would impose a wealth tax on residents with net worth of at least $1 billion, aiming to raise $100 billion for health-care funding, while opponents warn it could drive wealthy residents out of the state.
California voters will decide in November whether to approve a wealth tax targeting residents whose net worth exceeds $1 billion. The measure, which would apply retroactively to those living in the state as of Jan. 1, 2026, is designed to raise about $100 billion to offset recent federal cuts to California’s health-care budget.
Supporters argue the tax would ensure the ultra-wealthy contribute a fair share and help close the state’s large wealth gap. Suzanne Jimenez, chief of staff for Service Employees International Union-United Healthcare Workers West, said the proposal is a "short-term solution" to the federal funding reductions triggered by President Donald Trump’s tax and spending legislation.
Opponents, including Governor Gavin Newsom, caution that the tax could prompt high-net-worth individuals to leave California, reducing income-tax revenue. A September poll by the Berkeley Institute of Governmental Studies and the Los Angeles Times showed 45% of likely voters support the tax, 42% oppose it and 13% are undecided.
The initiative has already led some billionaires to consider relocation. Meta chief executive Mark Zuckerberg told his board he is weighing a move out of the state, and Meta has offered him additional shares to offset a potential $12.5 billion liability. DoorDash co-founder Andy Fang called the proposal "stupid" on social media and said he is planning to leave California. Businessman Tom Steyer, a former gubernatorial candidate, said he would vote for the tax despite concerns about its wording, emphasizing the need to protect vulnerable Californians.
Wealth taxes have been used in Europe but have largely been abandoned, with only Spain, Norway and Switzerland retaining them. Critics such as Dr. Kristian Niemietz of the Institute of Economic Affairs argue that wealth taxes create administrative burdens, discourage investment and generate limited revenue, citing evidence from Norway and Switzerland of capital flight and reduced taxable wealth.