# California Rejects Billionaire Tax as Democrats Split Over Measure - URL: https://twotakes.us/stories/california-rejects-billionaire-tax-as-democrats-split-over-measure - Published: 2026-11-11T08:10:35.495987+00:00 - Topics: wealth-tax, california, proposition-40, healthcare-funding, economic-inequality ## What the left says - Proposition 40 aimed to generate roughly $100 billion over five years primarily to protect Medi-Cal, hospitals, clinics, and emergency rooms from federal healthcare cuts enacted under the 2025 tax law. - Billionaires can accumulate enormous wealth through stock gains and business valuations without paying income tax until those gains are realized, making a wealth tax a matter of basic fairness. - Opponents spent nearly $400 million, including funding rival ballot measures, demonstrating how concentrated wealth can be mobilized to defeat policies that would ask the ultrawealthy to contribute more. - Voters simultaneously made permanent higher income tax rates on the top 2% of earners, showing continued support for taxing the wealthy even as the one-time billionaire levy failed. ## What the right says - The retroactive design of Prop 40, applying to anyone who was a California resident as of January 1, 2026, raised serious concerns about fairness and was expected to trigger legal challenges. - Wealthy residents like Sergey Brin had already begun relocating out of state in anticipation of the tax, illustrating the real risk that billionaires and their economic contributions would simply leave California. - Even progressives and some Democrats, including Gov. Gavin Newsom, opposed the measure, arguing it was a one-time fix that inadequately addressed long-term budget needs while risking capital flight. - The measure's rejection shows that taxing a small, mobile population of ultra-wealthy individuals is economically risky even in a state otherwise moving further left politically. ## Common ground - Proposition 40 was a one-time 5% wealth tax targeting California residents with a net worth over $1 billion, excluding real estate and certain retirement assets. - The measure was intended mainly to fund healthcare programs affected by federal cuts, with smaller portions directed to education and food assistance. - The campaign over Prop 40 became one of the most expensive ballot measure fights in California history, with opponents vastly outspending supporters. - The measure divided traditional Democratic allies, with figures like Newsom opposing it while labor unions such as SEIU-UHW championed it. ## Sources - [AllSides](https://www.allsides.com/news/2026-11-09-0800/politics-californians-reject-wealth-tax-billionaires) (Center) - [CBS News](https://www.cbsnews.com/news/california-proposition-40-billionaire-wealth-tax-rejected-cbs-projects/) (Lean Left) - [HuffPost](https://www.huffpost.com/entry/california-reject-propostion-40-billionaire-tax_n_6adbc903e4b027da9ae65e38) (Left) - [Just The News](https://justthenews.com/politics-policy/elections/california-voters-reject-billionaire-tax-measure?utm_source=justthenews.com&utm_medium=feed&utm_campaign=external-news-aggregators) (Right) - [Newsmax](https://www.newsmax.com/politics/california-billionaires-tax/2026/11/09/id/1275729) (Right) - [Newsweek](https://www.newsweek.com/californias-proposition-40-fell-victim-billionaires-paradox-12692679) (Lean Right) - [New York Times](https://www.nytimes.com/2026/11/09/us/california-billionaire-tax-prop-40.html) (Lean Left) - [NPR](https://www.npr.org/sections/planet-money/2026/11/10/g-s1-152755/why-did-californias-billionaire-tax-fail-to-surf-the-blue-wave) (Lean Left) - [Washington Times](https://www.washingtontimes.com/news/2026/nov/9/california-billionaires-tax-rejected-voters/) (Right) - [ABC News](https://abcnews.com/Politics/californias-prop-40-billionaires-tax-measure-rejected-ap/story?id=137999519) (Lean Left) - [AllSides](https://www.allsides.com/news/2026-11-10-0800/2026-midterm-elections-techs-biggest-names-sunk-tax-billionaires-wealth-425m-and-familiar-playbook) (Center) - [AllSides](https://www.allsides.com/news/2026-11-10-0800/2026-midterm-elections-california-faces-one-two-punch-voters-reject-wealth-tax-and-billionaires-eye-exits) (Center) - [AllSides](https://www.allsides.com/news/2026-11-10-0800/2026-midterm-elections-billionaire-tax-measure-california-ballot-defeated) (Center) - [Blaze Media](https://www.theblaze.com/news/bernie-billionaire-tax-california-rejected) (Right) - [HuffPost](https://www.huffpost.com/entry/biggest-ballot-measure-california-billionaire-tax_n_6af1fd82e4b08067d8496f03) (Left) - [Mother Jones](https://www.motherjones.com/politics/2026/11/california-billionaire-tax-prop-40-defeated-prop-42-passes-results-oligarchs-wealth-retirement-savings/) (Left) - [PBS NewsHour](https://www.pbs.org/newshour/politics/california-voters-reject-tax-on-net-worth-of-billionaires) (Lean Left) - [RedState](https://redstate.com/jerrywilson/2026/11/10/california-voters-side-with-sanity-reject-one-time-billionaires-tax-n2209252) (Unknown) - [The Daily Signal](https://www.dailysignal.com/2026/11/10/democrats-won-elections-but-voters-said-no-to-higher-taxes/) (Right) - [Washington Post](https://www.washingtonpost.com/politics/2026/11/09/california-proposition-40-wealth-tax-billionaires-live-election-results/) (Lean Left) - [Washington Times](https://www.washingtontimes.com/news/2026/nov/10/california-rejects-pioneering-wealth-tax/) (Right) --- Content by TwoTakes (https://twotakes.us). 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