A select group of California billionaires has invested a tiny fraction of their collective fortunes into a massive campaign to defeat Proposition 40, a proposed one-time 5% wealth tax targeting the state’s ultra-wealthy residents.
Out of approximately 260 California billionaires identified by the Forbes Real-Time billionaires list who would be subject to the tax, roughly 30 individuals or their spouses—about 1 in 8—have contributed a combined $293 million to oppose the measure. These funds are also directed toward supporting Propositions 41 and 42, counter-measures designed to nullify the wealth tax if approved by voters.
Google co-founder Sergey Brin has shouldered a significant portion of that financial push, contributing $102 million to the opposition campaign. That expenditure amounts to less than 1% of his estimated individual tax bill under the proposal. Several other prominent figures have funneled money through the political action committee of the California Business Roundtable, which is actively campaigning against Proposition 40 while backing Proposition 43. Among them, Peter Thiel contributed $3 million, Eric Schmidt gave nearly $2.6 million, Kim DeGeorge—wife of Marco DeGeorge—provided $1.9 million, Chris Larsen gave $750,000, and Douglas Leone and his wife contributed $500,000.
Proposition 40 would levy a 5% tax on individuals who were California residents on Jan. 1, 2026, calculated using their net worth as of Dec. 31 and made payable across five years. Economists Jasper Boll, Emmanuel Saez, and Gabriel Zucman calculated in an August paper published by the National Bureau of Economic Research that these targeted individuals would collectively owe at least $107 billion. That total accounts for projected tax avoidance and evasion, representing 5% of their combined estimated wealth as of Oct. 16. Distributed across all 39 million residents, $107 billion equates to roughly $2,700 per person, compared against a median household net worth of $303,000 in California as of 2023, according to the Public Policy Institute of California.
The state’s four wealthiest individuals—Sergey Brin, Jensen Huang, Larry Page, and Mark Zuckerberg—would account for 40% of the total revenue collected by the tax. Their fortunes are heavily tied to shares in high-value technology corporations. Data compiled from Forbes shows that California billionaire wealth nearly tripled between 2022 and 2026, with much of that surge remaining untaxed because traditional income taxes apply only when stocks are sold. Page and Brin reported no taxable income in three separate years since 2019, reflecting a broader trend among tech executives whose publicly disclosed income is minimal relative to their overall net worth.
To address potential tax impacts, Meta announced the creation of new nonvoting Class C common stock. The move follows summer discussions in which Zuckerberg informed company advisors of plans to relocate outside California to preserve his corporate voting power, which risked dilution if he sold massive blocks of stock to cover a 5% wealth tax. Under the new corporate arrangement, Zuckerberg agreed to remain in the state for eight years in exchange for retaining his voting control while selling shares to meet potential tax obligations.
While economists Saez and Zucman project the tax will raise over $100 billion with manageable impacts on income tax revenue from departures, researchers at the Hoover Institution estimate net state revenue closer to $40 billion, citing unannounced residency shifts and property acquisitions outside California ahead of the Jan. 1 deadline. Chris Hoene, executive director of the nonpartisan California Budget and Policy Center, noted that determining residency ultimately depends on time spent in the state rather than property ownership alone. The state Franchise Tax Board will handle residency assessments and calculate taxable wealth using public stock data alongside private appraisals of assets such as artwork and jewelry, while excluding real property, pensions, and retirement accounts.
Opponents argue the measure will drive wealth out of California, pointing to actions such as Brin registering to vote in Nevada last year and Thiel opening a Miami office on Dec. 31, despite purchasing a $130 million Bel-Air mansion in July. Proponents counter that projected income tax losses from relocating billionaires pale in comparison to wealth tax gains. Ninety percent of the revenue generated by Proposition 40 is earmarked for healthcare services to offset a projected $100 billion federal funding shortfall over ten years in Medi-Cal, a program providing coverage for one-third of low-income Californians.
The measure has drawn a diverse coalition of supporters and opponents. Gov. Gavin Newsom opposes a state-only wealth tax and advocates for a national approach, while gubernatorial candidates Xavier Becerra and Steve Hilton also oppose the measure. Additional opposition comes from the California Teachers Association, the California Medical Association, and Planned Parenthood Affiliates of California. Supporters include U.S. Sen. Bernie Sanders, the Service Employees International Union, the California Democratic Party, and the California Federation of Labor Unions AFL-CIO.
