Key facts
- Proposition 40 would impose a one-time 5% tax on certain California taxpayers with assets over $1 billion.
- Roughly 200 people who were California residents on January 1, 2026 could face the one-time tax, the report said.
- Propositions 41 and 42 could stop the tax from taking effect if either receives more yes votes than Proposition 40.
- Backers said the tax would raise over $100 billion for the state, with most proceeds going to healthcare.
- A Stanford paper estimated about $30 billion in initial revenue and a $38.9 billion loss over time as executives leave.
- Sergey Brin donated more than $100 million to the opposition campaign, per Cal Matters.
Californians voted on November 3, 2026 on Proposition 40, a ballot measure that would impose a one-time 5% tax on certain taxpayers with assets over $1 billion. Roughly 200 people who were California residents on January 1, 2026 could face the tax, according to the report.
State campaign-finance filings showed committees opposing Proposition 40 had reported about $130 million in contributions through October 22, against about $33 million for supporters. Google cofounder Sergey Brin donated more than $100 million to the No campaign, per Cal Matters. Former Google CEO Eric Schmidt, Affirm CEO Max Levchin, Stripe CEO Patrick Collison, DoorDash CEO Tony Xu, Kleiner Perkins Chairman John Doerr and angel investor Chris Larsen also gave to the opposition, the report said.
Two countermeasures could undercut the tax. Propositions 41 and 42 were designed to impose new auditor reviews and prohibit taxes on certain assets. If either receives more yes votes than Proposition 40, the billionaire tax could be stopped from taking effect even if a majority of Californians vote for it.
Taxable wealth would include ownership stakes in businesses, securities, investment accounts, art, collectibles and intellectual property, among other assets. Real estate, pensions and retirement accounts would generally be excluded. If the measure passes, the tax would be due in 2027, though taxpayers could spread payments across five years at a higher cost.
Backers said the measure could raise tens of billions of dollars over several years, with a majority going toward healthcare and the remainder to education, food assistance and operation of the tax program. The campaign pitched it as a way to help backfill looming federal cuts to Medi-Cal, and supporters said the tax would raise over $100 billion for the state.
A National Bureau of Economic Research working paper by Stanford economists, published in October, estimated the initial tax event could bring in around $30 billion before prompting high-earning executives to leave the state, and warned California could lose $38.9 billion over time.
Meta CEO Mark Zuckerberg weighed moving out of the state. In October, the company created a new class of shares that would give him $20 billion in immediate liquidity if the vote passes, potentially allowing him to pay the tax without giving up some of his voting power. Nvidia CEO Jensen Huang said during a January spot on Bloomberg TV: "I've got to tell you, I have not even thought about it once. We chose to live in Silicon Valley, and whatever taxes they would like to apply, so be it. I'm perfectly fine with it." Progressive Vermont Sen. Bernie Sanders backed the billionaire tax, while California's Democratic governor, Gavin Newsom, opposed the measure.