California Billionaire Tax Qualifies for November Ballot

A proposed one-time 5% wealth tax on California residents with net worth above $1 billion has qualified for the November ballot after organizers collected more than 1.5 million signatures. State officials announced the qualification on Wednesday. The measure needed 874,641 valid signatures and is estimated to raise $100 billion from roughly 200 billionaires.

Nearly all revenue from the tax would offset federal healthcare spending cuts. The proposal applies only to residents whose wealth exceeds the $1 billion threshold. The governor has opposed the state measure. The governor argued that wealth is movable and that a state-only tax would incentivize wealthy residents to relocate.

The governor stated that the fight belongs at the federal level.

The governor also recommended closing federal tax-code loopholes that allow borrowing against stock portfolios without reporting taxable income and passing appreciated assets tax-free to heirs.

“The fight to make the wealthiest Americans pay more in taxes is not one we should be fighting state by state." — Gavin Newsom, June 27 A congressman criticized the governor for supporting a national tax while opposing the state version. The congressman said the governor's announcement is misleading and accused the governor of avoiding a fight in the governor's own state. The president of the SEIU-United Healthcare Workers West, the union behind the state proposal, said there will not be capital flight from the state tax. The president argued that state residents are ready to support a modest one-time tax on the wealthiest residents. A Democratic gubernatorial nominee said the initiative represents sketchy policy. The governor wrote that 10% of Americans own two-thirds of the wealth and that current inheritance rules risk creating a permanent American aristocracy. The governor called for returning to pre-2017 federal corporate tax rates.”