Billionaires and Politicians Split Ahead of California Wealth Tax Vote

California's proposed billionaire wealth tax has divided the state's political establishment and technology industry, with hundreds of millions of dollars flowing into campaigns supporting or opposing the measure.

California Governor Gavin Newsom has also opposed Proposition 40.  [Photo: Gavin Newsom X]

Technology billionaires have committed more than $340 million to efforts opposing Proposition 40, according to campaign finance figures cited by Fortune.

Google co-founder Sergey Brin has contributed more than $100 million to the opposition effort. California Governor Gavin Newsom has also opposed Proposition 40.

On October 9, he endorsed Proposition 42, a competing ballot measure backed by Brin that would prohibit retroactive taxes on personal property and restrict the introduction of certain future wealth taxes, CalMatters reported.

The California Democratic Party, meanwhile, endorsed Proposition 40, exposing divisions within the state's majority party over the proposed levy.

Proposition 40 would impose a one-time 5% tax on the wealth of qualifying California billionaires.

The proposal has drawn opposition from wealthy technology executives who argue that the measure could encourage high-net-worth residents to leave the state, potentially reducing future tax revenues.

The campaign has also attracted support from some prominent technology figures who have said they are willing to pay the proposed tax.

Nvidia CEO Jensen Huang, for example, told Fortune that he had no intention of leaving California over the measure. He described the ability to pay an estimated $8 billion in taxes over five years as a privilege.

At a Stanford event, Huang also encouraged executives to move to California, citing the state's talent pool.

The November 3 ballot presents voters with more than a straightforward choice on the wealth tax.

Propositions 41 and 42 are competing measures that could nullify Proposition 40 if either receives more affirmative votes than the wealth-tax proposal.

Proposition 41 would introduce restrictions involving state taxes and spending, while Proposition 42 would prohibit certain retroactive taxes and new taxes on personal property.

The arrangement creates a complicated voting dynamic: Proposition 40 could receive majority support but still be blocked if either competing measure receives more yes votes.

Polling has shown fluctuating levels of support for the wealth tax and its countermeasures.

The results vary by survey and fieldwork period, underscoring the importance of identifying the poll and its sample when reporting voter sentiment.

The dispute has become one of California's most closely watched ballot battles, bringing questions about taxation, wealth concentration, migration and the state's long-term fiscal outlook into the center of the election campaign.