California Governor Gavin Newsom has publicly opposed a proposed state-level billionaire tax while advocating for a national alternative. The "One-Time Wealth Tax for State-Funded Health Care Programs Initiative"—a one-time 5% tax on the net worth of California's roughly 200 billionaires—qualified for the November 2026 ballot after receiving enough signatures. The measure, sponsored by the Service Employees International Union-United Healthcare Workers West (SEIU-UHW), aims to raise an estimated $100 billion for Medi-Cal and public education.
Newsom, who is considering a 2028 presidential run, argues that a state-level tax could drive billionaires to relocate to lower-tax states like Texas or Florida. He instead proposes a federal "true minimum tax on billionaires," modeled after the Buffett Rule, ensuring the wealthiest pay at least the same tax rate as their employees. His plan also includes closing tax loopholes, returning to pre-2017 corporate tax rates, and rewriting inheritance rules.
The ballot measure has sparked debate, with supporters framing it as a necessary step to address wealth inequality and fund critical public services. Opponents, including Newsom, warn of potential economic consequences, such as capital flight and reduced investment. Some billionaires, including Google co-founder Sergey Brin, have already taken steps to relocate, citing the tax as a factor.
The initiative has also exposed fractures within California's political and business communities. While SEIU-UHW remains committed to the measure, other unions and business leaders have expressed concerns. Meanwhile, Senator Bernie Sanders has endorsed the tax, calling it "reasonable and necessary" in the face of growing wealth consolidation.
The outcome of the ballot measure could set a precedent for wealth taxation in the U.S., with implications for both state and federal policy.