billionaire

California voters have rejected the controversial billionaire tax.

Proposition 40 sought to impose a one-time 5% tax on California billionaires’ assets to try to offset federal healthcare funding cuts.

Despite the blue wave in the midterm elections, the novel tax on the ultra-wealthy had trailed from the first day of vote counting and was officially rejected on Monday.

Roughly 53% of Californians voted against the measure, while 47% supported it, the Associated Press said when it declared that the proposition had failed.

Although the billionaire tax was rejected in the vast majority of counties, the late tally showed major pockets of support in Los Angeles and San Francisco — home to the lion’s share of the state’s 200 billionaires. Orange County, however, voted no by a wide margin.

The political battle over the ballot measure and two competing proposals divided the state and was among the most expensive in California history. More than $400 million had been spent on the three intertwined ballot measures, with more than 90% spent opposing the billionaire tax, according to fundraising disclosures filed with the secretary of state’s office.

Billionaires, notably Google co-founder Sergey Brin, poured hundreds of millions of dollars into groups that funded ads to kill the billionaire tax. California Gov. Gavin Newsom, the California Teachers Assn. and Planned Parenthood Affiliates of California are among the powerful Democrats and other Democrat-aligned groups that expressed fears that billionaires would flee the state. Some, including Brin and fellow Google co-founder Larry Page, moved out of California because of the proposal.

An onslaught of advertisements against the billionaire tax argued it could impact all Californians, not just the ultra-wealthy. Teachers, firefighters and other middle-class Californians became the face of their campaigns, fueling growing opposition ahead of election day.

Opponents of Proposition 40 said Californians made the “right decision,” calling Proposition 40 a “reckless experiment” that would hurt the state’s economy. The group included the California Medical Assn., California Primary Care Assn. and the California School Boards Assn.

“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.

Leaders of the Service Employees International Union-United Healthcare Workers West, which sponsored the proposition, vowed to put a billionaire tax proposal on the 2028 ballot if Sacramento leaders don’t find a way to better support the public health sector. Given California’s volatile budget, which is expected to be particularly problematic next year, it appears unlikely that state lawmakers will find a way to backfill an estimated $100 billion of federal healthcare funding cuts.

Supporters said the proposed tax on more than 200 California billionaires aimed to raise that amount, with 90% funding healthcare, and the remainder going to schools and food assistance.

“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,” said Suzanne Jimenez, chief of staff for the SEIU-UHW. “Californians will see for themselves what was at stake.”

This will not be the end of the debate about taxing the rich. U.S. Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Fremont), who both backed Proposition 40, are pushing for the passage of a federal 5% tax on American billionaires.

Earlier this year, they introduced the “Make Billionaires Pay Their Fair Share Act.” Despite Democrats winning control of the House and Senate last week, the legislation will probably face constitutional challenges if it passes.

Days after the midterm elections, Proposition 40 has yet to be decided. The ballot measure, which would impose a one-time 5% tax on California billionaires to help fund healthcare, is failing by more than 8 percentage points.

Statewide, more than 4 million votes remain to be counted in this race, according to the Associated Press, which calculates the expected vote using returns and other data. That includes more than half a million from Los Angeles County, where the “yes” vote leads by more than 7 percentage points.

The proposition has so far found support in nine counties: Alameda, Humboldt, Los Angeles, Mendocino, Monterey, San Francisco, Santa Cruz, Sonoma and Yolo. In Southern California, Los Angeles is the only county leaning toward “yes.”

Propositions 41 and 42

While Proposition 40 focuses narrowly on taxing billionaires, competing Propositions 41 and 42 would have broader impacts on the state’s ability to enact new taxes. And the measures could undercut Proposition 40 if it passes.

As of Friday, the latest vote tallies showed “yes” on Proposition 41 trailing by more than 7 points, while “yes” on Proposition 42 was ahead by more than 6 points.

Proposition 41 would would require audits for new state special taxes and prohibit new state taxes from being exempted from a voter-approved state spending limit. Proposition 42 would prohibit new taxes on retirement holdings, individually owned assets and other personal savings. If Proposition 40 passes and either of these measures passes with more “yes” votes than Proposition 40, it would prevent the billionaire tax from becoming law.

A late October poll showed voter opposition to Propositions 41 and 42 had grown even as support for the billionaire tax declined.

The money behind the measures

Support for Proposition 40 has totaled to nearly $35 million, mostly from the Service Employees International Union-United Healthcare Workers West, the healthcare workers union that proposed the tax.

Backers of Propositions 41 and 42 also opposed Proposition 40. Combined, they raised more than $300 million. Most of that money came from the billionaires who would be subject to the tax.

NEW YORK — Billionaire Leon Black has filed a federal defamation lawsuit against Rep. Robert Garcia (D-Long Beach) for public comments the Democratic congressman made tying him to disgraced financier Jeffrey Epstein.

The suit, filed Wednesday, comes less than two months after the House approved a resolution holding Black in contempt of Congress for defying the Oversight Committee’s subpoenas in its investigation into Epstein.

In June, Black appeared for a voluntary interview at the committee during which he denied any knowledge of Epstein’s sex trafficking network.

Weeks later, Garcia said during a TV interview that “Leon Black is at the center of Jeffrey Epstein’s crimes” and that Black “was one of the last people to actually interact” with Epstein before he committed suicide in prison.

In addition, Garcia said that he had “talked to survivors that have credibly named Leon Black as someone that was involved in direct abuse of women and was directly involved” with Epstein.

Those statements were false and were made maliciously, Black asserts through his lawyers. The defamation lawsuit filed in U.S. District Court for the Southern District of New York seeks a jury trial and $7.25 million in compensatory and punitive damages.

“Congressman Garcia’s knowing lies have caused real and significant ongoing harm to Mr. Black. His physical safety has been threatened, he has received a barrage of hateful calls, emails, and social media posts, and his business and philanthropic endeavors have suffered,” the filing states.

Garcia’s office didn’t immediately respond to requests for comment on the lawsuit.

In September, Garcia called the contempt resolution against Black “an important step toward justice and accountability.”

Black had refused to respond to subpoenas asking him to appear and to turn over any potential nondisclosure agreements involving the investigation into Epstein.

Black’s lawyers have repeatedly denounced the Oversight Committee’s pursuit of the former head of a private equity firm as an abuse of congressional power. They have maintained he had no knowledge of any of Epstein’s criminal conduct.

Black was among several prominent figures, including Bill Clinton and Bill Gates, who had been asked to appear as part of the Oversight Committee’s long-running probe of Epstein. Survivors of Epstein’s alleged sexual abuse have told personal stories of being young women in a trafficking enterprise organized by Epstein and his colleague Ghislaine Maxwell.

Despite a nationwide blue wave in the midterm election, California’s much-debated billionaire tax didn’t get the support many expected in one of the country’s most liberal states.

Since the Golden State’s powerful healthcare union proposed the new tax, supporters of Proposition 40 have faced a fierce, expensive battle against the world’s richest people.

In what has been described as a David-versus-Goliath fight, the underdog appears to have lost. The proposition, which would have imposed a one-time 5% tax on the assets of California billionaires to mostly fund healthcare, seemed headed toward defeat as votes were tallied Wednesday.

“In a deep blue state like California, most voters are going to support additional funding for healthcare, especially to replace Trump funding cuts. But in retrospect, the sponsors may wish they’ve been a little bit less ambitious,” said Dan Schnur, a politics and communications professor at USC, UC Berkeley and Pepperdine.

Nearly 56% of California voters rejected the proposal while 44% voted for Proposition 40. However, with roughly 6 million votes still needed to be counted, the results are still too close to call.

The battle over the billionaire tax has been one of the most expensive ballot-measure fights in California’s history, sparking a debate over wealth inequality and taxing the ultrawealthy. It also highlighted how billionaires have wielded more influence in politics.

Well-known politicians such as U.S. Sen. Bernie Sanders (I-Vt.), the California Democratic Party, healthcare workers and Hollywood celebrities including actor Mark Ruffalo, backed the wealth tax. But the idea drew opposition from California Gov. Gavin Newsom, the teachers union, Planned Parenthood, business groups and others who expressed fears that billionaires could flee the state.

The state’s next governor, Xavier Becerra, who just won, also opposed the tax.

Though California’s $4.25-trillion economy remains a global powerhouse, and a major draw for investments in AI and aerospace, thousands of businesses have moved to Texas and other states in recent years due to lower costs.

Opponents of the wealth tax heavily outspent Proposition 40 supporters, flooding televisions, radio, social media and smartphones with ads. Their message: the wealth tax is a reckless experiment and a tax on everyone, not just billionaires.

UC Berkeley law professor Brian Galle, who helped write the wealth tax proposal, said it’s tough to “fix a broken system” and get the facts to people when they were up against the ultrawealthy. Billionaires also own media outlets and social media companies, megaphones that help spread political messaging.

“When billionaires have half a dozen different strategies for buying this election, it shows that they already have too much money and pay too little back,” he said.

Support for the billionaire-bashing proposition had already begun to wane in recent months.

A poll by UC Berkeley’s Institute of Governmental Studies, co-sponsored by the Los Angeles Times and released last week, showed that voter support for Proposition 40 had fallen to 42% of voters surveyed last month from 48% in August.

The measure also may have lost fans because taxing assets rather than income can be a complicated and confusing process and sparks concerns among even non-billionaires on whether they want to allow the state to start demanding a slice of the value of the things that they own.

No matter the result, Proposition 40 also fueled a conversation about taxing billionaires that will continue, Galle said.

As of Wednesday afternoon, roughly $489 million has been raised to support and oppose Proposition 40 along with two ballot measures — Propositions 41 and 42 — that could block the wealth tax, data from the California secretary of state show.

The vast majority of that funding, more than $380 million, went toward killing the billionaire tax. Supporters of the wealth tax, including the Service Employees International Union-United Healthcare Workers West, trailed far behind, contributing roughly $100 million, according to filings with the California secretary of state.

Billionaires such as Google co-founder Sergey Brin contributed millions to a group called Building a Better California that funded ads against the wealth tax and propositions that could block it.

Money doesn’t always win an election, but a big funding imbalance is tough to overcome, Schnur said.

“As important as the money was to beat Prop. 40, the coalition against it may have been just as important. You didn’t see Sergey. You didn’t see tech billionaires in the ads. You saw teachers and nurses and firefighters,” he said.

The four richest Californians — Brin, Nvidia Chief Executive Jensen Huang; Google co-founder Larry Page and Meta Chief Executive Mark Zuckerberg — would owe 40% of the estimated taxes to be collected from the billionaire tax, according to an L.A. Times analysis.

Ahead of the election, billionaires made moves to prepare for the potential tax. Zuckerberg expressed concerns that if he had to sell his stock to pay the tax that could reduce his control over the company, but Meta’s board struck a deal to address that fear.

The billionaire tax proposal also faced other big hurdles. Proposition 42, which could have blocked the billionaire tax, was on track to pass. It would prohibit new taxes on “retirement holdings, individually-owned assets, and other forms of personal savings” and bar retroactive taxes.

“They didn’t just reject a single bad tax idea — millions of Californians backed the strongest protections available to protect their hard earned life savings from double taxation. They joined firefighters, law enforcement officers, building trades workers, seniors, veterans and small businesses in doing so,” said Nathan Click, a spokesman for Proposition 42.

On the other hand, Proposition 41 — a proposal that would have required audits for new state special taxes, and also could have blocked the billionaire tax — was headed for defeat.

Supporters of Proposition 40 tried to convince voters that taxing roughly 200 billionaires was the solution to raise $100 billion needed to offset federal healthcare cuts.

This week, the wealth tax’s supporters emphasized the high stakes. People won’t be able to afford healthcare coverage, children will die and hospitals will shutter, they said, if California lawmakers don’t find a way to get more funding.

“If Sacramento fails to protect patients and deliver a real solution that makes billionaires pay their fair share, healthcare workers will pursue every available avenue, up to and including returning to the ballot in 2028 with a billionaire tax,” said Suzanne Jimenez, chief of staff for the SEIU-UHW.

The fate of a controversial ballot measure to impose a new tax on California billionaires, proposed as a lifeline for the needy and castigated as a threat to the state’s fragile economy, appeared headed for defeat in early election results Tuesday night.

California voters also rejected another hotly contested measure, Proposition 39, which would have required voters to show identification when they cast ballots and elections officials to verify that all registered voters were U.S. citizens.

The billionaire tax, Proposition 40, would impose a one-time 5% tax on the assets of billionaires to raise an estimated $100 billion to assist millions of Californians destined to lose healthcare coverage under federal funding cuts. Two separate ballot measures, Propositions 41 and 42, were crafted to nullify the wealth tax and remained too close to call Tuesday evening.

While supporters of the billionaire tax did not concede Tuesday evening, they acknowledged facing tough odds in the race because of the avalanche of spending against them and warned that people will die if the measure fails.

“In the event that we don’t succeed with Prop. 40 tonight, if Sacramento fails to deliver a real solution to the healthcare crisis instigated by the [federal government], one that actually makes billionaires pay their fair share, then California’s healthcare workers intend to be back on the ballot in 2028 to correct the damage, and to overcome all of the lies and deception, and just completely outrageous campaigning that we’ve seen,” said Dave Regan, president of SEIU-United Healthcare Workers West, which crafted the proposal.

Voters rejected the Republican-led Proposition 39 at a time of growing distrust in the integrity of the electoral process nationwide, a wariness intensified by President Trump’s baseless claims that the 2020 election was stolen from him and false assertions that droves of undocumented immigrants, notably in California, are swaying elections.

On Monday, the Supreme Court rejected an emergency appeal by Trump’s attorneys to set aside 20,000 ballots in the state that the White House argued could be cast by people who are not citizens.

The proposals were among the 14 state ballot measures that California’s 23.3 million registered voters were asked to decide Tuesday in addition to congressional, statewide and local elections.

The billionaire tax was proposed in response to legislation signed by Trump last year that could result in millions of Californians losing Medi-Cal coverage, rural hospitals shuttering and other healthcare services being slashed unless a new funding source is found. The proposal would retroactively apply to billionaires who lived in California as of Jan. 1, prompting some to preemptively move out of the state. Ninety percent of the revenue would fund healthcare programs, and the remaining funds would be spent on education programs and food assistance.

Proposition 40 divided Democratic leaders because of concerns about its impact on the state’s volatile budget that is highly dependent on the wealthy. Gov. Gavin Newsom opposed the measure, while the state Democratic party endorsed it.

The effort supporting and opposing the tax and two ballot measures designed to nullify it came close to breaking a state campaign finance record. About $425 million had been donated to the three commingled ballot measures as of Tuesday.

The vast majority of that money was provided by California billionaires, including some of the state’s most powerful tech barons, opposing the wealth tax. The campaign was centered on three interwoven ballot initiatives: Proposition 40 and Propositions 41 and 42, both of which would undercut Proposition 40 through a series of strategic changes to state tax laws and new spending restrictions.

Neither explicitly stated that it would nullify the billionaire tax if Proposition 40 passed and either of the counter measures received more votes.

Proposition 41, which trailed slightly Tuesday evening, is framed as an effort to cut wasteful government spending and require audits of new special taxes. But it also would bar new taxes that are exempt from state spending limits. Proposition 42, which was slightly ahead, is presented as protection from state lawmakers taxing everyday Californians’ retirement funds, personal savings and home equity.

In polling leading up to election day, voters appeared to differentiate between the billionaire tax proposal and Proposition 3, which was approved by voters on Tuesday. . It would make permanent a temporary tax increase on wealthy Californians that largely funds education. The tax adds 1% to 3% to the state income tax of single filers who earn more than $360,000, joint filers who make more than $721,000 and heads of household who earn more than $490,000. Voters passed the tax in 2012 and extended it in 2016, but it is set to expire in 2031.

Voters cast ballots on several other proposals about local taxes, public financing of political campaigns, a landmark environmental law, housing, the state’s recall process, state lawmakers’ ability to redirect taxpayer money to the state’s “rainy day” fund, immunology and immunotherapy funding, and restrictions on how community healthcare clinics spend money:

Several ballot measures were decided Tuesday evening:

• Proposition 1, which proposed a $11.25-billion bond to boost the construction of affordable housing, was approved by voters.
• Proposition 2, which would gave state lawmakers more flexibility over state spending by exempting certain tax revenue from a state spending limit, allowing them to place it into a “rainy day” fund, was approved by voters.
• Proposition 37, which would create a down-payment assistance program to help middle-class Californians buy a home, was approved by voters.
• Proposition 44, which would require certain health centers to spend 90% of their revenue on patient care rather than overhead and executive compensation, failed.

Among those that remained too close to call:

• Proposition 4, which would allow state and local candidates to receive public campaign financing if they demonstrated broad support and agreed to expenditure limits.
• Proposition 5, a constitutional amendment that would alter the state’s recall process by limiting it to the question of whether to remove an elected official from office, and no longer including the cadre of candidates hoping to replace the politician.
• Proposition 38, which would create an $8.4-billion bond to support the immunology and immunotherapy fields.
• Proposition 43, which would bar local governments from imposing special taxes unless two-third of voters support the effort. Current law requires a simple majority vote.
• Proposition 45, which would amend the California Environmental Quality Act to speed up certain housing, water, energy, transportation and other projects deemed essential.

The billionaires targeted by the wealth tax on the November ballot include owners of some of California’s top sports teams and, among them, there will be winners and losers if voters approve the measure.

Which owners would be ensnared by the proposed tax on billionaires’ assets remains unclear, since it’s largely dependent on whether they are declared official California residents, at least for state tax purposes. And that’s before lawyers and accountants get involved, an almost certain bet if the ballot measure is approved by California voters.

So it’s possible that the majority owner of the Los Angeles Chargers, Dean Spanos, would have to pay the the wealth tax while the owner of the Los Angeles Rams, San Kroenke, would not — even though both their teams are playing on the same home field at SoFi Stadium in Inglewood. It all depends on whether the state considers Spanos or Kroenke official California residents and how their assets are tallied.

Other wealthy team owners or co-owners who have residences in California and could be subject to the tax include the Golden State Warriors’ Joe Lacob and Peter Guber, the San Diego Padres’ José E. Feliciano and Kwanza Jones, the San Jose Sharks’ Hasso Plattner and the Anaheim Ducks’ Henry Samueli.

Among those who appear to live out of state, according to news reports, and may not be impacted: the San Francisco 49ers’ Denise DeBartolo York and John York, the Los Angeles Clippers’ Steve Ballmer, the San Francisco Giants’ Charles Johnson, the L.A. Kings’ and the L.A. Galaxy’s Philip Anschutz.

In August, embattled billionaire Mark Walter agreed to sell the L.A. Lakers to former Disney chief executive Bob Iger and venture capitalist Joshua Kushner. The proposed billionaire tax would apply to Iger, who lives in California, but not Kushner, who lives in New York. A spokesperson for Iger declined comment. Walter, who also owns the Dodgers and has been under federal investigation, told the California Post on Wednesday that he has no plans to sell the team.

There is uncertainty and disagreement about how the tax would be levied on sports team owners, and how their ownership stakes would be evaluated by the state when assessing their assets.

Representatives of the Warriors and Chargers, declined comment. Spokespeople for the Kings, Padres, Sharks and Ducks did not respond to requests for comment, nor did representatives of Kroenke or Sun Microsystems co-founder Vinod Khosla, who lives in California and whose $9.6-billion purchase of the Seattle Seahawks was finalized in September.

Legendary sports agent Leigh Steinberg warned that the proposed tax would have unintended consequences. “It creates an uneven playing field,” he said. “Out-of-state owners get an advantage over in-state residents.”

Steinberg, who has represented more than 300 professional athletes including Troy Aikman, Drew Bledsoe, Michael Vick and Oscar De La Hoya, said the increased tax could be passed on to fans if voters approve Proposition 40 on Nov. 3.

“Ticket prices are high enough anyway, and somewhat prohibitive to a working person or young person attending a game live,” Steinberg said. “The last thing in the world positive for the growth of sports is passing on that surcharge.”

Dodgers fans buy food at Dodgers Stadium.

(Gina Ferazzi/Los Angeles Times)

Proposition 40 would impose a one-time 5% levy on many of the assets of billionaires, including their holdings in companies. It was crafted by a healthcare union to compensate for federal healthcare cuts signed by President Trump last year that will cost California an estimated $100 billion, impacting the state’s most vulnerable residents.

David Gamage, a tax law and policy professor at the University of Missouri’s law school, countered that consumers would be far more hurt by the impacts of the impending federal healthcare funding cuts than by potentially higher prices at sporting events.

“The billionaire wealth tax would address the healthcare crisis caused by the Trump administration slashing Medicaid and other healthcare funding. Passing the billionaire wealth tax would be expected to reduce healthcare costs and thereby keep the prices of hot dogs and other consumer goods lower,” Gamage said. “Trying to fool voters by implying otherwise is shameful.”

More than 200 billionaires live in California, some of whom moved themselves or their businesses out of the state because of the proposed tax. Facebook creator Mark Zuckerberg, the chief executive of social media giant Meta, told company leaders that he planned to leave the state to avoid his control over the company being substantially diluted by being forced to sell enough stock to pay the proposed levy. Last week, the company announced the creation of a new nonvoting type of stock that would allow Zuckerberg to sell enough shares to pay the proposed tax while retaining his voting power in exchange for him agreeing to remain in the state for eight years.

Protesters in New York demonstrate against Elon Musk following the launch of the SpaceX initial public offering.

(Spencer Platt / Getty Images)

Proposition 40 supporters say that billionaire sports team owners have benefited from Trump’s tax cuts — dividends they didn’t share with the fans who spend hard-earned money to bring their families to games — and that they need to pay their fair share.

Opponents argue that professional sports are among myriad California economic engines that will suffer if voters approve the proposition, in part because owners based in the state would be subject to the tax while those who reside in other parts of the country would be exempt.

The measure “will also drive up the cost of operating a sports team in California, increasing the price of tickets, concessions and merchandise,” said Rob Lapsley, president of the California Business Roundtable. “This is just one of many ways Proposition 40 will cost Californians.”

A poll by UC Berkeley’s Institute of Governmental Studies released Thursdayshowed public sentiment had turned against the billionaire tax, with half of likely voters opposing it and 42% supporting it.

Clippers owner Steve Ballmer addresses the crowd.

(Lindsey Wasson / Associated Press)

More than $404 million has been donated to efforts supporting and opposing the wealth tax, according to the California Secretary of State’s Office. Proponents of the ballot measure had raised $36.5 million as of Thursday, while opponents received nearly $368 million.

The residency of billionaires is often difficult to ascertain, given that many have multiple properties across the nation and around the world. It is not solely based on where the person is registered to vote.

Among the “facts and circumstances” the California Franchise Tax Board considers are the person’s employer, their spouse’s and childrens’ locations, where mail is delivered, and the location of doctors, accountants, lawyers, country club memberships and houses of worship. The number of days spent in California also is factored into the board’s assessment of residency.

Lakers part-owner Patrick Soon-Shiong at a game.

(Gina Ferazzi/Los Angeles Times)

Los Angeles Times owner Dr. Patrick Soon-Shiong, a billionaire, owns 4% of the Lakers and recently became a co-owner of a new women’s professional volleyball team in Los Angeles expected to start competing next year.

Soon-Shiong noted that it’s not only wealthy Californians who oppose the tax. Teachers, firefighters and other groups oppose Proposition 40 because of concerns about long-term impacts on the state. And, as a businessman with stakes in sports teams, he predicted bad effects on pro sports.

“It’s really, really expensive to bring a family to watch a professional game, whatever that game may be,” he said during an interview in September. “All those costs will go up, and for sure, it’ll be passed down to the cost of the ticket.”

Times Library Director Cary Schneider contributed to this report.

The so-called billionaire tax has become one of the most contested California propositions in years, generating national interest and massive spending by opponents. It also has spawned two rival ballot measures.

Here’s a cheat sheet for sorting it all out.

Proposition 40

The basics

Proposition 40 would impose a one-time 5% tax on California billionaires’ assets. The tax applies to people with a net worth of at least $1 billion who resided in California on Jan. 1.

Impact

Ninety percent of the tax would fund healthcare, and 10% would go toward education and food assistance.

The tax would affect hundreds of billionaires whose net worth includes assets such as their businesses, stocks and other investments. Real property, pensions and retirement accounts generally would be excluded.

Proposition 41

It’s called the Improving Transparency, Effectiveness and Efficiency in California Government Act. But it is deeply connected to Proposition 40 and is funded by foes of the billionaire tax.

The basics

Proposition 41 requires the state auditor to review programs funded by proposed special taxes before they appear on the ballot. More importantly, it also prohibits new state taxes from being exempted from a voter-approved state spending limit.

Impact

The Legislative Analyst’s Office says passage of Proposition 41 could prevent Proposition 40, the proposed billionaire tax, from becoming law even if voters approve it. This could happen if Proposition 41 receives more “yes” votes than Proposition 40.

Proposition 42

Proposition 42 would limit the state’s ability to impose certain new taxes. But it’s more complicated and far-reaching than that description might sound. And, yes, it’s also backed by opponents of Proposition 40.

The basics

Proposition 42 would prohibit new taxes on “retirement holdings, individually owned assets, and other forms of personal savings” that take effect after Jan. 1, 2026. It also would bar retroactive taxes on past earnings unless the state is using revenue from the tax to respond to emergencies such as a fire or a flood.

Impact

The Legislative Analyst’s Office says Proposition 42 could nullify Proposition 40 because the two measures conflict with each other. If voters approve both, the one with the most “yes” votes generally would become law, the office says.

Dig deeper

The billionaire tax was pushed by the Service Employees International Union-United Healthcare Workers West and has some labor and progressive support, including from Sen. Bernie Sanders (I-Vt.) and the state Democratic Party. They say the tax is needed to help the less fortunate and that the super-rich can afford it. But key Democrats and some key unions are not supporting it.

Critics include some of California’s richest people, and they are spending a fortune to defeat it. They say it will hurt innovation and drive the wealthy out of the state, hurting the treasury.

More reading

A powerful union and the birth of the billionaire tax (L.A. Times)

Why unions are divided over Prop. 40 (L.A. Times)

The Google co-founder fighting the billionaire tax (L.A. Times)

Inside the massive spending to defeat Prop. 40 (L.A. Times)

How the billionaire tax could spark national movement (The New Yorker)

The academics behind Prop. 40 (Sacramento Bee)

Will Prop. 40 reallly bring an exodus? (L.A. Times)

Why healthcare is divided by Prop. 40 (Bloomberg)

Taxing the “ultrarich,” a guide (New York Times)

As California decides whether to slap billionaires with a special tax, the Golden State’s swarm of social media stars is chiming in — and increasingly getting paid to influence voters.

Unlikely influencers, from foodies to mothers to retirees, are weighing in on Proposition 40, a one-time 5% tax on the assets of the state’s roughly 200 billionaires and on other ballot measures created to cancel it.

Campaigns try to team up with and sometimes compensate key content creators, as their endorsements often hit harder than traditional political ads.

Between cheery Instagram videos about budget-friendly trips to a playground, a Halloween house and zoo with her kids, Bartley Chavez posted a video opposing Proposition 40 to her more than 47,500 followers.

“Look, I’m all for trying new things. A new recipe? Sure. A crazy haircut? Go for it. A quirky movie with the kids. Why not? But when we’re talking about California jobs, our family’s financial future, and the state’s economy, that’s not something I want to experiment with,” she says in the October video.

The video’s caption states the campaign opposing Proposition 40 paid her to post.

Getting political online does come with risks. In the video’s comments, one Instagram user said they unfollowed Chavez’s account, and another called her a “sell out.” Others backed her position. Chavez didn’t respond to a request for comment.

Los Angeles author and political influencer Leigh McGowan has built an audience of more than 3.5 million followers on different platforms with her no-nonsense takes on politics and other issues. She was already a supporter of the wealth tax when the Proposition 40 campaign started to pay for some of her posts.

“No one is punishing the rich. They are doing just fine,” she said in a sponsored video on Instagram. “We are simply asking them to pay an outstanding one-time tax that’ll help the rest of us.”

Campaigns have been paying attention to influencers as younger people turn to them for news, said McGowan, who’s known for pontificating from her kitchen. Many people distrust traditional media and want regular people to break down complex topics.

“We don’t know who to believe anymore, and there are just so many lies out there,” McGowan said in an interview. “The people who take the time to say authentically this is what they believe in, that’s who people believe.

In California, political ad spending in the 2026 election cycle is projected to approach $1 billion, more than any other state, according to political advertising intelligence firm AdImpact. Roughly $114 million is expected to go to digital platforms such as Facebook, Google, Snapchat and X.

The campaign opposing Proposition 40 has plenty of money to spend on political messaging in what’s become one of the most expensive ballot fights in California’s history. Billionaires such as Google co-founder Sergey Brin have donated millions to Building a Better California, a group funding ads against the wealth tax proposal. More than $350 million has been contributed to fight the billionaire tax and support two propositions — 41 and 42 — that could block it.

Campaign finance forms show how much groups spend on digital media, but they don’t say how much of that goes to influencers. While the data are limited, campaign leaders and other experts say social media stars are playing a bigger role in how brands and political movements advertise.

“Any modern campaign that wants to win needs to be active in spaces where voters get information — and that’s exactly what the No on 40 coalition is doing,” said Evan Westrup, a spokesman for the coalition opposing Proposition 40.

Some political influencers broadcast their views independently or talk to campaigns without compensation. Others are paid a few hundred dollars or even up to $30,000 per post, according to an October report from the Center for Democracy & Technology and the Communication Technology Research Lab at the University of Pittsburgh.

Influencers will post content for political campaigns to make money, but “genuine belief in political issues or candidates can — and often does — coexist with compensation,” the report said.

One Los Angeles influencer, The Speech Prof, who has more than 1.7 million combined followers on Instagram and TikTok, said he refused money to stop the billionaire tax.

The creator, also known as Professor Chesko, talks about everything from parenting and misogyny to politics. In September, he posted a viral video in which he says he rejected a large amount of money to oppose the billionaire tax.

This month, he posted a new video backing the billionaire tax, noting that the Proposition 40 campaign paid him to make the content. “It’s not nearly as much, but they’re a healthcare union and not corporate oligarchs. Plus I already said where I stand for free,” he said in the October video.

Professor Chesko didn’t respond to a request for comment.

The storm of new voices chiming in on the political debate, delivered through people’s personalized social media feeds, could be causing confusion, said Ramesh Srinivasan, professor of information studies at UCLA.

“If I’m seeing a completely different reality than you, whether it’s through influencers, AI or social media microtargeting,” he said. “Then it’s impossible to have a common basis for making decisions or choices.”

While the anti-billionaire tax war chest is much bigger, groups behind the tax say they’re still winning on social media.

“Despite being heavily outspent, the Prop. 40 campaign has been beating the billionaires on social media content and impact,” said Suzanne Jimenez, chief of staff for the SEIU-UHW, the healthcare union backing the billionaire tax.

She said influencers support the tax even when they’re not paid because they understand that “California needs functioning hospitals and emergency rooms, not more tax breaks for billionaires.”

Some sponsored influencers are avoiding direct criticism of the billionaire tax and instead signaling support for a ballot measure that could nullify Proposition 40 even if voters approve it.

Proposition 42 prohibits new taxes on “retirement holdings, individually-owned assets, and other forms of personal savings,” but it conflicts with the billionaire tax proposal. If voters approve both, the one with the most “yes” votes generally would become law.

Karen Clay-Fenderson, a Los Angeles mom and retired teacher with more than 120,000 Instagram followers, has posted videos about Proposition 42.

“I did my research on 42, and I did see something about the billionaire tax. But I want to keep my retirement and my life savings. I don’t want that taxed,” she said in an interview.

She disclosed that the Proposition 42 campaign paid her for the videos, but didn’t go so far as to tell people how to vote.

“They understand that we have influence, and people listen to what we have to say,” she said. “That’s why I’m very cautious. This is what I’m doing, but you need to make your choice.”

In California, influencers must disclose that they are being paid by a political campaign. In September, Gov. Gavin Newsom signed legislation that would penalize influencers who failed to disclose that they were paid to post political content. Influencers could face fines of up to $5,000 per post.

Social media platforms also have their own rules. Instagram allows paid political ads, but TikTok doesn’t — though enforcement has been an issue.

Nathan Click, a spokesperson for Proposition 42, said their partners disclose they are paid and follow all campaign laws.

“Creators play an important role in the political conversation,” he said. “And campaigns across the country partner with them to ensure their audiences understand what’s at stake in the election.”

California voters are souring on a Nov. 3 ballot measure to impose a one-time tax on billionaires to help fund healthcare programs, a proposal that has triggered one of the most expensive political battles in state history.

Half of likely voters plan to vote against Proposition 40, the proposed wealth tax on billionaires’ assets, while 42% support it, according to a new poll by UC Berkeley’s Institute of Governmental Studies that was co-sponsored by the Los Angeles Times. The findings mark a significant decline in support of the measure, which was crafted by an influential California healthcare union to compensate for an estimated $100 billion in federal healthcare cuts approved by President Trump and congressional Republicans.

The survey also found that a solid majority of likely voters opposed Proposition 39, which would require Californians to provide identification when voting and election officials to verify registered voters are U.S. citizens. The findings come as the Trump administration continues to attack California as a haven for voter fraud, including unfounded allegations of rampant illegal voting by undocumented immigrants.

Mark DiCamillo, the poll’s director, said previous surveys showed support for Proposition 40 has been fragile, and the most recent shows its prospects have dimmed as election day approaches.

The increase in opposition to Proposition 40 is “broad-based and spans virtually all major segments of the electorate,” DiCamillio said. The ballot measure was leading in a Berkeley poll conducted just six weeks ago, albeit by a slim margin, so its reversal of fortune is significant, he said.

The declining support comes after an onslaught of money spent opposing Proposition 40, including a torrent of television and social media ads airing everywhere from NFL games to “Everybody Loves Raymond” reruns. Nearly $368 million has been contributed to efforts opposing the billionaire tax, while $36 million has been donated to support the proposed levy.

Proposition 40 would impose a one-time 5% tax on the assets of billionaires who resided in California as of Jan. 1, with some exceptions. Democrats and their allies are splintered over the proposal. Some, including Gov. Gavin Newsom, argue it will prompt the wealthy to flee California, further harming its volatile budget, which is dependent on the state’s richest residents. The California Democratic Party and leading progressives support the measure, with Sen. Bernie Sanders (I-Vt.) calling it a modest tax necessary to help Californians struggling because of cuts imposed by Republicans to pay for tax breaks for the wealthy.

While Republican voters overwhelmingly oppose Proposition 40, nearly two-thirds of Democrats support it and more than a quarter opposing it. There is also a generational divide, with 6 out of 10 voters 65 years old or older opposing the measure, while more than two-thirds of those under 30 supporting it, according to the poll.

The findings are similar to a Public Policy Institute of California poll released Tuesday, which found 52% of likely voters would vote against Proposition 40, while 46% supported it.

The campaign against the wealth tax, funded by some of California’s richest tech moguls, is centered on three intertwined ballot initiatives: Proposition 40 and Propositions 41 and 42, both of which would undercut Proposition 40 through a series of changes to state tax laws and spending restrictions.

Proposition 41 would cut wasteful government spending by requiring audits of new state special taxes and would bar new state taxes that are exempt from a state spending limit. Proposition 42 would prohibit new taxes on retirement holdings, individually owned assets and other personal savings. Both Propositions 41 and 42 would nullify the billionaire tax if it passes, provided either measure receives more votes.

A plurality of voters oppose Propositions 41 and 42, a reversal from just six week ago, according to the poll.

In mid-September, voters were closely divided about Proposition 41 — 37% in favor and 33% opposed — with a large number of undecided. In the current poll, 38% of likely voters favor the measure and 47% oppose it. Proposition 42 led by 9 percentage points in the Berkeley/L.A. Times poll in September — 43% in favor and 34% opposed. Now, 43% of likely voters support it and 45% oppose it.

DiCamillo said backers of a ballot measure also should be concerned any time support registers below 50%, since voters who are undecided or unsure tend to vote no.

“It’s below 50%, and it’s trending down. Both of those are ominous signs,” DiCamillo said. Proposition 42 is “still very close. I’m not saying it’s definitely going down, but it’s moving in the wrong direction late in the campaign, and usually movement in a late poll is even more significant than the actual numbers themselves,”

He added that while many voters were unaware the two proposed ballot measures were designed as poison pills to kill the billionaire tax, among those who knew, the opposition was significantly greater.

If all three measures fail, that still would be a victory for the billionaires who spent aggressively to tank the wealth tax.

Another notable finding was voters’ support of Proposition 3, which would make permanent a higher income tax rate on the wealthy that funds education. A majority of voters — 54% — support continuing the levy, while 37% oppose it, according to the poll. DiCamillo says the disparity in support of the proposed billionaire tax and the extension of the existing wealth tax has been consistent in IGS’s polls, and is likely because of the differing foundations of the levies.

“Proposition 3 is already in place, and if you read the fiscal impact, if this were to pass, it maintains $5 billion to $15 billion of annual funding,” he said, “It’s a big revenue generator, and I think that is something that’s already in place.”

“Voters kind of understand the progressive nature of California’s tax system, and they kind of support that, but they don’t support nearly as much the idea of some new kind of tax, the wealth tax, which is taxing assets rather than income,” he said. “So that’s the distinction.”

These ballot measures are among 14 that voters will decide on Nov. 3, as well as statewide, congressional, local and judicial elections.

Among the other controversial measures is Proposition 39, a measure pushed by Republicans that would require all voters in future elections to show government-issued identification every time they vote in person or provide a special PIN or the last four digits of their Social Security number when submitting mail-in ballots.

The measure also would require the California secretary of state and county election officials to verify that registered voters are U.S. citizens by “using government data,” which according to supporters could include information in the federal Social Security Administration database, jury summons information and other government records.

Nearly 6 in 10 likely voters oppose the effort, while more than a third support it, split largely along party lines. More than half of voters who are registered as “no party preference” or with a smaller political party oppose the proposal, which DiCamillo said was an indication of trouble for the proposition given the state’s Democratic majority electorate and the proximity of the election.

“It’s hard for Republicans to push something over the finish line by themselves,” he said.

Other prominent ballot measures:

• Proposition 43, which would prohibit local governments from imposing certain new special taxes unless two-thirds of voters approve the proposal. Such proposals need a simple majority vote to be approved. While 46% of likely voters oppose the proposal, 36% support it, challenging numbers this close to election day, DiCamillo said. “It needs to get to 50,” he said. “We’ll see how you do that this late in the campaign.”

• Proposition 4, which would repeal a prohibition of public financing of campaigns, allowing state and local governments to support candidates if they abide by several rules. Likely voters are evenly split about the proposal, with 41% supporting it and opposing it, and 18% undecided. “It’s close, but it’s still below 50%. Most voters tend to vote no in the late going if they’re not convinced,” DiCamillo said, adding that he viewed the lack of support among voters who do not affiliate with a political party as a signal of potential failure.

The poll of 2,787 registered California voters was conducted online in English and Spanish Oct. 19-25 and has a margin of error of about 3 percentage points in either direction.

About 260 California billionaires would be subject to Proposition 40’s one-time 5% wealth tax according to the Forbes Real-Time billionaires list. Just 30 of those billionaires or their spouses, or 1 in 8, spent money opposing Proposition 40, the billionaire tax, according to a Times analysis of recent campaign filings.

Billionaires have individually contributed $293 million to oppose the tax measure and to support Proposition 41 and 42, which would nullify the billionaire tax if either receives more votes, according to a Times analysis. Sergey Brin, co-founder of Google, has given $102 million, more than a third of all billionaire money against the measure. But this is less than 1% of his estimated tax bill.

Several billionaires also contributed to the political action committee of the California Business Roundtable, which is spending to oppose Proposition 40 and support Proposition 43. Peter Thiel gave $3 million, Eric Schmidt gave nearly $2.6 million, Marco DeGeorge’s wife, Kim, gave $1.9 million, Chris Larsen gave $750,000 and Douglas Leone and his wife gave $500,000.

Proposition 40 would apply the tax to billionaires who were California residents on Jan. 1, 2026, and the taxable amount would be based on their net worth on Dec. 31. The tax is payable over five years.

Altogether, these individuals would owe at least $107 billion in taxes, according to an analysis by economists Jasper Boll, Emmanuel Saez and Gabriel Zucman. Their research was published in the National Bureau of Economic Research in August. Saez and Zucman are also architects of the tax proposal.

This amount is 5% of their combined estimated wealth by Forbes as of Oct. 16 and factors in a certain amount of tax avoidance and evasion. Spread across all 39 million Californians, the $107 billion would be roughly $2,700 per person. The Public Policy Institute of California estimates that the median household net worth in California was $303,000 in 2023.

The four richest Californians — Sergey Brin, Jensen Huang, Larry Page and Mark Zuckerberg — would owe 40% of the estimated taxes to be collected from the billionaire tax, according to a Times analysis. Their wealth largely comes from ownership of stock in extremely high-value technology companies.

Their net worth would increase 5% in about four months if their stock investments continues to grow as they have since December.

California billionaire wealth grew nearly threefold from 2022 to 2026, according to Times analysis of Forbes data collected by Boll and his colleagues, and much of that growth was not taxed. Billionaires’ taxable income is small compared with their wealth, because most of that wealth is invested in public stocks, and gains aren’t taxed until the stock is sold.

Page and Brin disclosed no taxable income in three of the years since 2019. Many others had similarly no publicly disclosed income. For that reason, Boll and his colleagues estimate that the Proposition 40 one-time tax would raise more than $100 billion, “with comparatively minor impacts on income tax revenue” from some billionaires leaving the state.

Based on Meta’s filings, the economists estimated that Zuckerberg’s taxable income was about $947 million in 2025, just 0.4% of his net worth.

Over the summer, Zuckerberg shared with Meta advisors his plans to relocate outside California to avoid the possibility of a significant reduction in his control over the company as a result of selling enough stock to fund a 5% tax. The advisors determined that Zuckerberg’s leadership presence at Meta headquarters was essential to the company’s success. On Wednesday, Meta announced the creation of new, nonvoting Class C common stock, which will allow Zuckerberg to sell the amount he needs to pay his potential tax bill while maintaining his voting power in exchange for his commitment to remain in the state for eight years.

Researchers at the Hoover Institution estimate the revenue to the state to be closer to $40 billion based on reports of billionaires’ residential purchases outside the state before and after Jan. 1 and their estimate of unannounced residency moves.

Chris Hoene, executive director at the California Budget and Policy Center, a nonpartisan group, said the residency question hinges on the amount of time spent living in the state. “Purchasing property in another location does not mean that they have changed their residency,” he said.

Ultimately, the state’s Franchise Tax Board, responsible for administering the tax, will have to assess residency. Hoene says this task is “easier for them to do than people realize.” The board will also calculate the amount of wealth subject to the tax using publicly available stock information and private assessments of personal property, such as artwork and jewelry. Real property, pensions and retirement accounts would be excluded.

Opponents of Proposition 40 are concerned that the threat of wealth taxes will lead to billionaires continuing to leave the state, resulting in a long-term decrease in state income tax revenue. Forbes recently reported that Brin registered to vote in Nevada last year. Peter Thiel disclosed Dec. 31 that he opened a new office in Miami; Florida has no wealth tax or income tax. But in July, he purchased a $130-million mansion in Bel-Air.

“The reality is the income tax loss can never get anywhere near the scale of what the wealth tax gain would be,” Hoene said.

Ninety percent of that gain would be spent on healthcare services to fill a gap in Medi-Cal from losses in federal funding that the measure’s authors estimate would total $190 billion over the next 10 years. Medi-Cal provides healthcare coverage for one-third of low-income Californians, according to the Legislative Analyst’s Office.

Gov. Gavin Newsom opposes a California-only tax and has instead called for a national wealth tax. Democrat Xavier Becerra and Republican Steve Hilton, who are running to replace Newsom, have spoken out against the tax. Other opponents include the California Teachers Assn., the California Medical Assn., and Planned Parenthood Affiliates of California. Supporters include Service Employees International Union, U.S. Sen. Bernie Sanders (I-Vt.), the California Democratic Party and the California Federation of Labor Unions AFL-CIO.

Times staff writer Queenie Wong contributed to this report.

Foes of Gov. Gavin Newsom, who is widely viewed as a likely 2028 presidential candidate, are launching television and digital ads this weekend in early primary states that criticize the governor’s opposition to the proposed billionaire tax on California’s November ballot.

The ad, funded by backers of the wealth tax, castigates Newsom for opposing Proposition 40, the ballot measure that would impose a 5% tax on California billionaires’ assets to offset federal healthcare funding cuts approved by congressional Republicans and signed by President Trump last year.

“We’re all struggling with the high cost of healthcare. In California, Democrats are championing a one-time tax on billionaires that would save coverage for millions,” a narrator says in the 30-second ad. “So why [has] presidential hopeful Gavin Newsom betrayed his own supporters by trying to sabotage the billionaire tax? Maybe it’s because the same billionaires who oppose Prop. 40 also gave millions of dollars to Newsom. Gavin Newsom turned his back on working Californians. Will he do the same to you?”

The ad specifically calls out billionaires Stewart Resnick, who owns several businesses including Pom Wonderful, Fiji Water and Justin Wines; crypto executive Chris Larsen; former Google leader Eric Schmidt; and venture capitalist Michael Moritz, all of whom have backed Newsom’s political ambitions.

Newsom has argued that, although he supports wealth taxes, they ought to be enacted at the national level, rather than a state-by-state patchwork that could drive the rich to leave California, a state with a volatile budget heavily dependent on the state’s wealthiest residents.

The primary funders of the ad are the Service Employees International Union – United Healthcare Workers West, which crafted Proposition 40; Saikat Chakrabarti, a climate change warrior and political advisor who made his wealth in part as a founding engineer at Stripe; and Ross Boucher, an early engineer at Stripe.

The ad buy is six figures but could grow, according to its backers. Among the states where the ad is expected to air are South Carolina, Nevada, New Mexico, Virginia and New Hampshire.

Earlier this month, Newsom stumped for candidates in New Hampshire, his latest foray to early presidential primary states.

The ad launch comes amid a contentious, expensive battle over the proposed wealth tax, which has divided Democrats and their allies. Although Newsom is among Democrats who oppose it, the ballot measure was endorsed by the state Democratic Party and Sen. Bernie Sanders (I-Vt.). Voters are closely divided about the measure.