California voters reject first-in-the-nation billionaire tax
Wikimedia CommonsCalifornia voters have rejected Proposition 40, a first-in-the-nation tax on the net worth of billionaires, ending one of the most expensive ballot fights in the state's history.
The Associated Press determined on Monday, November 9, that the "no" side had received enough votes to win. In the latest count from the California Secretary of State, the measure was failing by about 53 percent to 47 percent. Most Californians vote by mail, and ballots postmarked by Election Day that arrive within a week are counted, so close races often take days to settle.
Proposition 40 would have imposed a one-time 5% tax on the wealth of Californians whose net worth exceeds $1 billion and who were residents of the state on January 1, 2026. Most of the money would have been used to backfill federal funding cuts to healthcare, and 10% would have gone toward education and food-assistance programs.
The measure was backed by SEIU United Healthcare Workers West, which said it was necessary to replace an estimated $100 billion the state will lose in federal healthcare funding over five years. Backers projected the tax could have raised as much as $100 billion over that period. California has a little over 200 billionaires who own a cumulative total of approximately $2 trillion in wealth.
The "no" side raised roughly 10 times as much as the "yes" side. Billionaires donated millions to a political action committee, Building a Better California, which raised more than $333 million — nearly a third of it from Google co-founder Sergey Brin alone, who put in more than $100 million. Brin, along with fellow Google co-founder Larry Page, was among the billionaires who started cutting ties with the state in anticipation of the possible tax. Meta CEO Mark Zuckerberg, by contrast, said he would remain in the state for eight years and made a deal with Meta to help him pay the tax without losing his ownership stake.
The measure's failure is a win for Democratic leaders who opposed it, including Gov. Gavin Newsom, who may run for president in 2028. Critics said the tax would have prompted ultrawealthy taxpayers to leave the state. Some traditional Democratic allies, including Planned Parenthood and the California Medical Association, joined a coalition opposing it, concerned about how the tax revenue would be divided and about the impact on the state's budget if wealthy taxpayers left. Newsom has said a California wealth tax would disadvantage the state, but he supports a national minimum tax on anyone with a net worth above $100 million.
Proposition 40 was the nation's biggest test yet of an idea progressives have long championed: raising taxes on the ultra-rich by targeting the main way they make their money — through their investments rather than the paychecks they receive from work. Vermont Sen. Bernie Sanders rallied in cities across California in the race's closing weeks to urge voters to pass it, and Massachusetts Sen. Elizabeth Warren has long supported a federal wealth tax.
Supporters signaled the fight is not over. The "Yes on 40" campaign said backers could put a similar tax back on the ballot in 2028. "Buying an election is not the same as winning the debate," the measure's proponents said in a statement on Monday. "The billionaires may have bought themselves a temporary victory at the ballot box, but they have not bought themselves an end to this debate, and this is only round one."
The AP Voter Poll found a sharp generational split: a majority of California voters younger than 30 voted "yes" on Proposition 40, while roughly 7 in 10 voters aged 65 and older voted "no." About half of voters with a household income under $100,000 supported the measure, while close to 6 in 10 voters with an income of $100,000 or higher opposed it.
Sources: The Associated Press, "California voters reject measure to tax the wealth of billionaires" (Nov. 9, 2026); TechCrunch, "California's proposed 'billionaire tax' fails to pass" (Nov. 10, 2026).
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