California Voters Reject Billionaire Tax With 53% Against

By Amara Osei

Roughly 53% of California voters rejected Proposition 40, the one-time 5% tax on billionaires' assets designed to offset federal healthcare funding cuts, the Associated Press declared on Monday.

The measure trailed from the first day of vote counting, despite a Democratic sweep in the mid-term elections. It won 47% support. Voters rejected it in the vast majority of counties, though Los Angeles and San Francisco — home to most of the state's 200 billionaires — backed it. Orange County voted no by a wide margin.

How much money shaped the outcome?

More than $400 million was spent across three intertwined ballot measures, and more than 90% of that went to opposing the billionaire tax, according to fundraising disclosures filed with the Secretary of State's office. That makes the fight one of the most expensive in California history. On Wednesday, the measure already appeared headed for defeat, though results were then too close to call.

Google co-founder Sergey Brin poured hundreds of millions into groups funding ads against the tax, according to the report. Brin and fellow Google co-founder Larry Page moved out of California because of the proposal. Gov. Gavin Newsom, the California Teachers Assn. and Planned Parenthood Affiliates of California also opposed it, citing fears that billionaires would flee the state. Notably, the campaign against the wealth levy (a tax on total assets rather than income) did not feature billionaires in its ads — it featured teachers, firefighters and other middle-class Californians, arguing the tax could affect everyone.

Both sides also paid social media influencers, some with millions of followers, to post videos aimed at swaying voters.

What did opponents and supporters say?

The opposition coalition — including the California Medical Assn., California Primary Care Assn. and California School Boards Assn. — called the result the "right decision" and branded Proposition 40 a "reckless experiment."

"Proposition 40 risked California's economic competitiveness and fiscal stability, as well as the revenue we rely on to fund our top priorities — from education and healthcare to public safety and infrastructure," the group said.

The measure's sponsor, SEIU-United Healthcare Workers West, targeted an estimated $100 billion in federal healthcare funding cuts. It planned to allocate 90% of proceeds to healthcare, with the remainder for schools and food assistance.

Suzanne Jimenez, chief of staff for the SEIU-UHW, did not concede on the substance: "Billionaire-funded propaganda may have influenced the outcome of this election, but as hospitals reduce services, emergency rooms close and families lose access to care, the truth will become increasingly difficult to hide. Californians will see for themselves what was at stake."

What happens next?

The SEIU-UHW's leaders vowed to place a billionaire tax on the 2028 ballot if Sacramento does not find a way to support the public health sector. That is a tall order: California's budget is volatile and expected to be particularly problematic next year, making it unlikely lawmakers will backfill the estimated $100 billion in federal healthcare cuts.

The debate also moves to Washington. Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Fremont), both Proposition 40 backers, this year introduced the "Make Billionaires Pay Their Fair Share Act," a federal 5% tax on American billionaires. Democrats won control of the House and Senate last week, but the legislation will likely face constitutional challenges if it passes.

A state-level defeat funded overwhelmingly by the people it would have taxed has not ended the argument — it has moved it to 2028 and to Congress.