Union Scales Back Billionaire Tax Proposal After Ballot Qualification

A labor union behind a proposed tax on California billionaires scaled back its plan one day after qualifying the original measure for the November ballot. The Service Employees International Union Healthcare Workers West offered to drop the 5% rate in favor of a 2% levy if the governor agreed to support it.

The revised proposal would require legislative approval because the June 25 deadline for ballot qualification had passed. " The original plan called for a one-time 5% tax on individuals with net worth above $1 billion, with revenue directed toward healthcare, food assistance, and education programs.

The tax would apply to people living in the state as of January 1, 2026, and was projected to raise $100 billion.

The governor's office stated the measure would reduce funding for teachers, schools, clinics, and public safety. The California Medical Association and California School Boards Association formed a committee to urge voters to reject the proposal if it reaches the ballot.

Silicon Valley donors contributed more than $118 million to oppose the tax, with one individual donating $82 million. The nonpartisan Legislative Analyst's Office estimated the 5% tax would generate tens of billions initially but could reduce annual income tax revenue by hundreds of millions later.

State lawmakers approved budget measures this week that extend a tax on healthcare providers to address revenue needs. Senate President pro Tempore Monique Limón said the budget does not include the billionaire tax and instead relies on other revenue sources to close a structural deficit.