Prop 40 Puts $100 Billion Health Bill on 200 Californians

Mark Zuckerberg could owe as much as $12.5 billion under California’s Proposition 40, a one-time 5% tax on the net worth of the state’s billionaires. If voters approve the measure in November, it would apply to the roughly 200 residents of California who hold at least $1 billion in assets. The tax would take effect retroactively for anyone meeting the wealth threshold who lived in the state on January 1, 2026.

Supporters argue the levy will raise $100 billion to offset federal funding cuts to the state’s healthcare system. These cuts stem from President Donald Trump’s tax and spending bill. Suzanne Jimenez of the Service Employees International Union-United Healthcare Workers West described the measure as a “short-term solution.” She told the BBC that inaction would lead to a collapse of the healthcare system while longer-term funding strategies are developed.

Francesco Trebbi, a public policy professor at the University of California, Berkeley, stated that this appears to be the first billionaire tax targeting such an extreme percentile of wealth distribution. California holds the largest economy in the United States and the fourth largest globally, surpassing India and the United Kingdom. Despite this economic size, the state has the nation’s largest share of homeless people and one of its widest wealth gaps.

Governor Gavin Newsom, whose term is ending, opposes the measure. He warns that the tax could drive wealthy residents and their income tax revenue out of the state. Google cofounder Sergey Brin has contributed more than $100 million to a political organization funding ballot measures intended to block the tax, according to the Los Angeles Times. A September poll by the newspaper and the Berkeley Institute of Governmental Studies found 45% of likely voters in favor, 42% opposed, and 13% undecided. A majority is required for passage.

Several billionaires have already relocated. At least six high-net-worth individuals have left, including Google cofounders Larry Page and Sergey Brin, venture capitalist Peter Thiel, former Uber CEO Travis Kalanick, and Hankey Group founder Don Hankey. Hankey told Forbes that he moved to Nevada because the proposal made him feel “not wanted,” despite the jobs his companies created in the state.

Meta chief Mark Zuckerberg informed his board last month that he is considering moving his primary residence out of California. The company, headquartered in the state, agreed to a new stock deal providing him with additional shares to cover potential losses. Other reactions are split. Nvidia chief Jensen Huang told CBS that he does not mind paying taxes and that higher earners should pay more. Senator Bernie Sanders told a Los Angeles rally that billionaires believe they have a “God-given right to rule” and predicted they would learn a “very powerful lesson” on November 3.

Washington state voters are simultaneously weighing a 9.9% income tax on earnings over $1 million. Wealth taxes have become rare in Europe, with only Spain, Norway, and Switzerland retaining them. Kristian Niemietz of the Institute of Economic Affairs described such levies as “more trouble than they are worth.” In the United States, the top 1% of households held nearly 32% of wealth in the third quarter of 2025. Trebbi characterized the sentiment behind the measure as “anti-elite, anti-system,” aiming to “re-balance the scale a little bit.”