What to know about California's billionaires tax proposal
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A potential 2026 ballot measure would ask voters to approve a one-time 5% tax on California's billionaires in a bid to offset health care and K-12 funding threats.
Why it matters: The move comes as California grapples with sweeping federal cuts to health care funding, which health care unions say could result in around 145,000 jobs lost, higher insurance premiums and loss of coverage for millions of people.
Driving the news: The proposed initiative would tax the 2025 net worth of billionaires who live in California — about 200 people who altogether have a combined wealth of nearly $2 trillion, according to organizers.
- 90% of the collected revenue would go to health care programs and providers, especially those that serve low-income and vulnerable populations. The remaining 10% would be allocated for K-12 public education.
- Because the tax would be on individuals' net worth, billionaires wouldn't be able to avoid it by moving assets outside California. They'd pay off the obligation over five years.
- Service Employees International Union-United Healthcare Workers West (SEIU-UHW) and St. John's Community Health in Los Angeles are spearheading the measure.
What they're saying: "We are facing literally a collapse of our health care system here in California and elsewhere," Dave Regan, president of SEIU-UHW, said at a news conference last week.
- "This will help us keep health care facilities open. It will stabilize premiums and coverage for all Californians, protect health care jobs and also improve public education."
The other side: Opponents say it would push people to leave the state and that establishing a wealth tax could create a dangerous precedent.
What's next: To be placed on the 2026 ballot, the initiative requires "nearly 550,000 valid signatures," according to the Sacramento Bee.
The big picture: Compared with the average American, billionaires pay a smaller percentage of their true income in taxes, a 2025 study by UC Berkeley economists found.
- California was home to 255 billionaires in 2024, according to the Wall Street Journal.