California ballot measure would tax billionaires at 5% to fund Medicaid

California voters will decide in November whether to impose a one-time 5% tax on individuals and trusts holding assets greater than $1 billion. The measure, called the 2026 Billionaires Tax Act, covers business interests, securities, cryptocurrency, vehicles, artwork, and intellectual property.

The tax would apply retroactively to Jan. 1, 2026, and would affect even those who have left the state in the past year. State analysts estimate the levy would generate tens of billions of dollars over several years beginning in 2027.

Revenue allocation and petition support Most of the proceeds would go to the state Medicaid program, which backers say faces a potential $19 billion annual reduction in federal support. A smaller share would be directed to public education. More than 900,000 signatures were gathered to qualify the initiative, according to organizers.

National context and polling Washington, Maryland, Massachusetts, and Minnesota already tax millionaires or are considering similar steps. No other state has proposed a tax on billionaires that reaches as far as the California measure. A poll conducted earlier this year by the Economist and YouGov found that 80% of Americans view the wealth gap as a very big or somewhat big problem.

Sixty-two percent said billionaires are not taxed enough.

Federal proposals Sen.

Bernard Sanders introduced a federal wealth tax in March that would apply a 5% annual levy to the nation’s 938 billionaires. Revenue would partly fund $3,000 direct payments to households earning $150,000 or less. If the California measure passes, supporters said they will promote similar initiatives in other states and that Democratic lawmakers are preparing federal wealth-tax legislation.