A proposal to tax the wealthiest Californians is expected to appear on the November ballot for voters after the divisive initiative received the required number of valid petition signatures.
The 2026 Billionaire Tax Act
The 2026 Billionaire Tax Act has already split Democrats: while progressives want to impose a one-time tax on the rich, others, including some prominent Democratic leaders, argue it will further push out wealthy people and businesses out of the state.
Under the initiative, California residents and trusts whose net worth is at least $1 billion would be taxed up to 5% of their assets. The proposal has a Jan. 1, 2026 residency cutoff, which means those who were in California at that time would be taxed whether they still live in the state or not.
The one-time tax could generate about $100 billion, with the 90% of the revenue going toward health care and 10% to be spent on food assistance or education-related programs.
Labor unions and health care groups say billionaires should contribute more to the state and its public services when many Californians are faced with the affordability crisis.
Sen. Bernie Sanders, Rep. Ro Khanna and former gubernatorial candidate Tom Steyer support the proposal.
Governor Gavin Newsom is one of the prominent opponents, arguing the proposal would further drive billionaires out of the state, reducing investment and future tax revenue for the state. He has also argued that the state is already heavily relying on high-income taxpayers.
Democratic gubernatorial candidate Xavier Becerra as well as Katie Porter, Antonio Villaraigosa, Matt Mahan also said they oppose the billionaire tax.
Planned Parenthood is among the large progressive organizations against the proposal, arguing the initiative does not clearly lay out how the revenue would be spent.
The California Medical Association also opposes the billionaire tax, saying it “will not provide the sustainable and long-lasting funding that our schools and communities deserve.”
Original reporting: NBC4 Los Angeles — read the source article.
