Here we go again: Led by SEIU, which is the most powerful union in California, and by Democrats in the state, they are pushing a billionaire tax, which has already made headlines nationwide, as Bernie Sanders campaigned in favor of the proposition a few weeks ago. The proposal would impose a one-time 5 percent tax on individuals who were California residents on January 1, 2026, and whose net worth exceeds $1 billion at the end of that year.
The idea for this tax is to pay for California's medical program, also known as Medi-Cal. Part of the revenue would go to public K-12 education, as well as the food assistance program. If the proposition is passed by voters, the tax would be due in 2027.
The repercussions for this "one-time tax" are not worth it because, in the long-run, it could reduce state income tax revenue as even more billionaires leave the state.
Per the National Taxpayers Union Foundation:
For reference, the $100 billion in hoped-for revenue comes from a calculation by academics Brian Galle, David Gamage, Emmanuel Saez, and Darien Shanske, essentially taking $2.2 trillion in California billionaires’ wealth from Forbes estimates, assuming just 10% avoidance, then multiplying that by 5%. If $700 billion in billionaire wealth has indeed already fled the state, their revenue numbers are already $25 billion too rosy.
Collectively, the amount of Billionaire wealth that has left California in the last month (!) is now in excess of $700B.
— Chamath Palihapitiya (@chamath) January 9, 2026
That means the $2T of California wealth they expected to tax is now down to $1.3T and falling quickly. I would not be surprised if 2026 ended with less than… https://t.co/J0qIYrKJXB
Gov. Gavin Newsom (D-CA) is against this proposal as he is positioning himself for a presidential run. But Newsom is no stranger to pushing billionaires out of the state, as the wealthiest individual, Elon Musk, fled California, moving his companies out of California, too, into Texas.
I did make it clear to Governor Newsom about a year ago that laws of this nature would force families and companies to leave California to protect their children
— Elon Musk (@elonmusk) July 16, 2024
However, even before the November election, when the proposition will be on the ballot, billionaires in the state are not chancing it. Many of them are leaving and going to states like Florida and Texas. Individuals such as Larry Page, Sergey Brin, David Sacks, Mark Zuckerberg, and Peter Thiel have all left the state already. Just recently, the New York Post reported that Uber co-founder Travis Kalanick has also left California for the Lone Star State.
But some of the billionaires who were not able to leave the state prior to January 1, 2026, could still be held responsible for the wealth tax.
Independent Rep. Kevin Kiley (CA-03) has proposed legislation that would stop the Democrats' shenanigans:
The "Wealth Tax" would confiscate the assets of former California residents if they don't leave the state in time. So individuals worth $1 trillion have left. Steven Spielberg and Mark Zuckerberg are the latest.
— Kevin Kiley (@KevinKileyCA) February 21, 2026
I've introduced a bill to stop this unconstitutional scheme. pic.twitter.com/X1cBxYcam4
ALSO SEE: We Are Watching a Wave of Corporate Migration As Companies Run From Blue States
Viva, Las Vegas: Wealthy Californians Bolt to Nevada Over Looming Tax Hit
If this proposition passes, assuming enough billionaires remain to pay their share for the proposals, it will hurt the state in the long-run due to more fleeing and the state losing that revenue. Not to mention, big corporations are also leaving the state, the prime example being Musk relocating X, Starlink, and Tesla headquarters from California to Texas. If enough billionaires flee by November, SEIU and other unions' wishes would be dead on arrival.
SWAMP WATCH: The mere threat of a “Billionaire Tax” has already cost California $1 trillion of wealth.
— Steve Hilton (@SteveHiltonx) January 16, 2026
I explain how this IDIOTIC stunt by the Democrat unions is hurting taxpayers of all incomes. Watch👇 pic.twitter.com/m5YcEqHL9q
Leftists may never understand that taxing billionaires more than their fair share won't work because no matter what, they will find ways not to pay, and worse yet, they will leave the state. Those who need billionaire funding for their pipe-dream policies will get even less revenue than they think they have now. It's a lose-lose situation, but if California votes to pass this proposition, we will certainly see other states following suit and trying to pass a wealth tax of their own.
