California Voters Reject $100 Billion Billionaire Tax Plan
Prop 40 failed despite support from major unions and national Democrats, as opponents outspent supporters by a wide margin.
By Chinedu Schneider ·
California voters voted down a proposal to impose a one-time 5% tax on the wealth of billionaires in the state. The Associated Press called the race on November 9, marking a defeat for a measure that supporters argued would raise $100 billion for healthcare.
The initiative, known as Prop 40, gained momentum after the Republican-controlled Congress cut healthcare programs. Advocates, led by the SEIU-UHW union, argued that wealthy Californians should fill the funding gap. The state is home to more than 200 billionaires, according to estimates.
The vote split the state's Democratic party. Gov. Gavin Newsom and gubernatorial candidate Xavier Becerra both opposed the tax. They preferred a national levy on the wealthy. Rep. Ro Khanna and Sen. Bernie Sanders campaigned in favor of the measure, alongside the state Democratic Party.
Opponents claimed the tax would drive the wealthy out of California, hurting the state's revenue and economy. A leading teachers union also opposed the plan, noting it would direct only a small share of revenue to schools.
Sergey Brin, the Google co-founder, led a surge in campaign spending against the measure. At least five times as much money was spent opposing Prop 40 as supporting it. Brin also funded campaigns for two other ballot measures designed to block the billionaire tax if it had passed.
The rejection of Prop 40 ends the state-level effort to tax billionaire wealth. The two companion measures that would have blocked the tax also failed to pass, leaving the status quo in place for now.
