Voters in California appear poised to reject Proposition 40, a significant tax measure that aimed to implement a one-time 5% tax on billionaires in the state. The proposal, which was on the ballot for the election held on 3 November 2026, sought to generate approximately $100 billion to bolster healthcare initiatives and other social programmes. As of the latest counts, around 60% of ballots tallied indicate that over 4.2 million voters have opposed the measure, with the “no” vote at 55.6%, marking a notable increase of more than 11 percentage points.
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The proposition was designed to target the wealth of California residents who qualified as billionaires on 1 January 2026. Taxpayers could opt to spread their payments over five years, though doing so would incur higher costs, as indicated by the state’s Legislative Analyst’s Office. Approximately 90% of the projected revenue was earmarked for healthcare services, with the remaining funds allocated to education, food assistance, and administrative costs associated with the tax collection.
Despite receiving a narrow endorsement from the California Democratic Party, the measure faced opposition from several influential groups within the state. Notably, organisations such as the California Teachers Association and Planned Parenthood Affiliates of California expressed their concerns, suggesting that the proposal could negatively impact California’s financial landscape by driving wealthy taxpayers out of the state.
Governor Gavin Newsom also opposed the initiative, articulating worries that implementing such a tax could result in billionaires relocating and taking their substantial tax contributions with them. Newsom’s office clarified that while he supports a national tax targeting billionaires, he viewed the state measure as poorly constructed and potentially detrimental to California’s economy.
The anticipated tax sparked fears among some of California’s wealthiest individuals, prompting them to explore alternatives. Mark Zuckerberg, the CEO of Meta, indicated that he might consider leaving California should Proposition 40 pass, estimating his potential tax bill at around $12.4 billion based on his roughly $247 billion net worth. To mitigate the potential financial burden, Meta’s board recently approved a new type of non-voting stock that Zuckerberg could utilise to raise funds for the tax without relinquishing his control over the company.
In a further illustration of the concerns the proposal raised among affluent Californians, prominent figures such as Google co-founder Larry Page and venture capitalist Peter Thiel were reported in December 2025 to be contemplating a reduced presence in the state, anticipating the passage of the measure. Collectively, billionaires contributed around $293 million to oppose the proposition and support countermeasures, as detailed by an analysis from the Los Angeles Times.
Sergey Brin, another Google co-founder, was notably active in the opposition campaign, investing roughly $102 million to counter the measure. During the early phases of the campaign, opposition efforts reportedly cost over $1 million a day in the first 19 days of September, as highlighted by The Guardian.
Senator Bernie Sanders from Vermont, who actively campaigned in favour of Proposition 40, framed the electoral battle as a pivotal moment for democracy in the United States. He posed a critical question about the influence of wealth on political outcomes: “In America today, is it possible for a ballot item to win when it is being opposed by a handful of billionaires who are spending over $200 million?” he queried in a press call ahead of the election, indicating a concern over the extent to which billionaires could dominate the democratic process.
Conversely, not all wealthy Californians were looking to escape the tax. Jensen Huang, the CEO of Nvidia, publicly stated that he was unfazed by the prospect of a substantial tax bill, estimated at around $8 billion. In an interview aired on CBS Sunday Morning, Huang expressed a sense of responsibility regarding taxation, stating, “The more you make, the more taxes you pay. I’m okay with that.” He reflected on his circumstances with pride, describing his ability to afford such taxes as a privilege, and conveying a genuine concern for economic disparity rather than fear of his tax obligations.
As the ballot results continue to unfold and discussions about wealth inequality persist, Proposition 40 serves as a focal point in California’s ongoing debate over taxation, social welfare, and the evolving responsibilities of the ultra-wealthy in supporting public goods.
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