Wealth tax initiative faces $351 million spending gap in California ballot race
Opponents of Proposition 40 have raised more than $316 million, while supporters have collected about $34 million, making the campaign one of the costliest in the state's history.
More than $351 million in donations has been poured into the contest over Proposition 40, a ballot measure that would impose a one-time 5% tax on the assets of California billionaires who were residents on Jan. 1. About 90% of the spending is directed at defeating the proposal, with the remainder supporting two related measures, Propositions 41 and 42, that would neutralize the tax through changes to state tax law.
The anti-tax coalition, organized by the group Building a Better California, includes donors from both major parties, labor groups and business leaders. Among the largest contributors are billionaire donors Sergey Brin, who has given more than $100 million, and Eric Schmidt and L. John Doerr, each contributing $40 million.
Supporters of the tax, led by the Service Employees International Union-United Healthcare Workers West, have raised $34.3 million, primarily from union sources. They argue the tax is needed to offset anticipated cuts to California’s healthcare budget after federal funding reductions.
"Trump’s ‘Big Beautiful Bill’ slashes healthcare funding, with major coverage cuts scheduled to hit after the midterms," said Suzanne Jimenez, chief of staff for the union.
"We are opposed to this particular proposal because we think it does more harm than good," said Jodi Hicks, chief executive of Planned Parenthood Affiliates of California.
"The pro-40 campaign picked a fight and then came to that fight with a butter knife against a nuclear arsenal," said GOP strategist Rob Stutzman, noting the financial advantage of the opposition.
Opponents have used a range of media, including television, streaming platforms, mailers and digital games, to convey their message. The pro-tax campaign has focused on signature gathering and voter outreach through emails and texts, urging voters to support Proposition 40 while rejecting Propositions 41 and 42.
Legal scholars anticipate challenges to the tax’s retroactive application, describing it as a significant legal issue.
"It’s kind of a mess," said Jessica Levinson, election law professor at Loyola Law School.
The spending disparity highlights the scale of the battle, with anti-tax groups raising $316.7 million compared with the $34.3 million raised by proponents as of mid-October.