The measure, backed by SEIU-United Healthcare Workers West, would impose a 5% tax on the personal wealth of California’s estimated 200 billionaires. Supporters say the money would help protect health care access while also providing funding for public education and food assistance programs.

But the proposal has drawn sharp opposition from some of the state’s wealthiest residents, business interests, Gov. Gavin Newsom and even some labor groups. The dispute has renewed a long-running debate in California politics: who should pay for public services, and how much?

California’s initiative system was created in the early 20th century as part of a reform movement led by figures such as Gov. Hiram Johnson, who argued that voters needed a way to bypass a Legislature heavily influenced by powerful interests. More than a century later, ballot measures have become expensive political battles, often funded by groups with major financial stakes in the outcome.

Recent elections have shown how costly those fights can become. In 2022, casino-owning tribal governments and online gambling companies spent roughly half a billion dollars on competing sports betting measures. Voters rejected both, but the campaign underscored the enormous sums that can be spent when billions of dollars in future revenue are at stake.

The billionaire tax proposal is part of a broader set of tax-related measures expected to shape the next statewide ballot. Public employee unions and other advocates for expanded services are pushing for additional revenue, while opponents argue California already depends too heavily on high earners and businesses to fund state government.

Under the SEIU-UHW proposal, 90% of the money raised from the billionaire wealth tax would go toward health care. Smaller portions would support public education from kindergarten through community college and food assistance programs. The measure’s backers have estimated the tax could generate tens of billions of dollars, potentially as much as $100 billion.

That allocation has caused friction even among groups that often support tax increases. Some unions have objected to the plan because health care would receive the overwhelming majority of the proceeds, leaving comparatively modest shares for schools and anti-hunger programs.

Newsom has emerged as the most prominent opponent of the proposal and has been pressing SEIU-UHW leaders to withdraw it before the ballot is finalized. The deadline to remove measures from the November ballot is approaching quickly.

Opponents argue the measure could damage the state’s budget by prompting wealthy Californians to leave. California relies heavily on income taxes paid by high earners, making state revenue especially sensitive to the financial decisions of a small number of residents. Critics say a tax on wealth, even if described as a one-time levy, could convince billionaires and other wealthy households that California is becoming too unpredictable.

Some wealthy Californians have already left the state, citing the potential tax as a factor, while others may have quietly changed their residency. Opponents have also formed campaign committees and pursued countermeasures intended to blunt or undercut the tax if it reaches voters.

A central issue in the dispute is whether the proposal would truly be limited to a one-time tax. The measure states that lawmakers could amend the tax if changes are consistent with and advance the purposes of the Billionaire Tax Act. Those stated purposes include protecting access to high-quality and equitable health care and supporting funding for education and food assistance by raising revenue from billionaire wealth.

Critics contend that language could give the Legislature room to extend the tax or broaden it to people with lower levels of wealth, depending on how courts interpret the measure. Supporters frame the proposal as a targeted way to raise money from the very richest Californians for essential public needs.

California’s political history gives opponents another argument. In 2012, voters approved what was described as a temporary income tax increase on the state’s wealthiest residents. Four years later, unions and other supporters backed a successful measure extending that tax through 2030. A new proposal this year seeks to make it permanent.

That history has become part of the case against the billionaire tax. Once a revenue source is created, opponents say, groups that benefit from the funding have strong incentives to keep it going.

For voters in Southern California and the Inland Empire, the debate could have practical consequences. State funding for health care, schools, community colleges and food assistance affects counties such as Riverside and San Bernardino, where demand for public services remains high. At the same time, the statewide budget depends heavily on revenue from high-income taxpayers, making any shift in where wealthy residents live or pay taxes a matter of concern for local governments and service providers.

Whether the billionaire tax actually appears on the November ballot now depends on the final days before the deadline. If it remains, California voters will be asked to decide another high-stakes tax question — one likely to draw major spending from both supporters and opponents.

Original source: CalMatters

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The measure, known as the Local Taxpayer Protection Act, has qualified for the November ballot with backing from the Howard Jarvis Taxpayers Association, the group long associated with Proposition 13. If approved by voters, it would restrict local real estate transfer taxes and raise the voter-approval threshold for new local taxes from a simple majority to two-thirds.

Supporters of local housing funding say the measure is gaining momentum in part because of backlash against several high-profile city transfer taxes that were adopted with the goal of generating money for affordable housing but have produced unintended consequences.

In Los Angeles, Santa Monica and San Francisco, voters approved higher real estate transfer taxes aimed largely at expensive property sales. Those measures were often described as “mansion taxes,” but critics say the costs have fallen heavily on commercial and multi-family property transactions — the kinds of deals that can affect future housing production.

Real estate transfer taxes are charged when property changes hands, typically as a percentage of the sale price. Counties and general law cities in California are limited to a 0.11% transfer tax. Some charter cities, however, have adopted much higher rates.

Los Angeles’ Measure ULA applies to property sales above $5 million. Critics say the structure creates a sharp cutoff: a property sold for just under the threshold avoids the tax, while a larger apartment building above the line can face a major added cost. An affordable eight-unit apartment building, for example, could owe more than $200,000 in transfer taxes, while a luxury home sold for $4.9 million would owe nothing under ULA.

Housing advocates argue that the measure has slowed sales and discouraged new apartment development. A UCLA analysis cited by critics found that Measure ULA may be costing Los Angeles city and county governments more in lost property tax revenue than it is producing through the transfer tax. Unlike transfer taxes, which are collected only when a property is sold, property taxes generate revenue every year for cities, counties, schools, fire districts and other public agencies.

Santa Monica’s Measure GS has faced similar criticism. The measure charges $56 per $1,000 on sales of $8 million or more, one of the highest rates in California. In the year after it took effect, residential sales above that amount reportedly dropped by half, while commercial sales fell from 18 to five. Revenue came in at less than half of projections.

San Francisco’s Proposition I, which imposes rates of up to 6% on the largest property transactions, has also been blamed for reducing sales and slowing housing activity. City leaders there are now pursuing a proposal to cut the tax in half.

The November ballot measure would address those local taxes by limiting transfer taxes statewide to 0.11%. But opponents say it goes much further by making it far harder for local governments to raise new revenue for basic services and housing programs.

That provision could have broad consequences for cities, counties and special districts throughout California. In fast-growing and infrastructure-stressed regions such as the Inland Empire, local governments often rely on voter-approved revenue measures to help pay for transportation improvements, fire protection, schools, housing programs and other needs.

Housing advocates are urging state leaders to negotiate a compromise before the June 25 deadline, when proponents could still withdraw the measure from the ballot. They argue that lawmakers can correct what they view as poorly designed transfer taxes in a few cities without imposing sweeping new limits on local governments statewide.

The debate places state leaders in a difficult position: balancing concerns over taxes that may be discouraging housing development with the need to preserve local funding tools at a time when California remains under pressure to build more homes and maintain essential public services.

Original source: CalMatters

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The proposal, backed by the Service Employees International Union Healthcare Workers West, would impose a one-time, 5% tax on individuals whose net worth exceeds $1 billion and who were living in the state as of Jan. 1, 2026. The goal is to generate $100 billion in revenue, which would largely be used to offset federal funding cuts to healthcare for low-income people.

“California’s health is at stake,” said Liz Perlman, executive director of a chapter of the American Federation of State, County and Municipal Employees, a major labor union. “Hospitals are closing and people will die. Why? So billionaires can get another tax cut that they don’t need.”

The California Secretary of State still has to verify the signatures and officially place the measure on the ballot. Backers say they collected more than 1.5 million signatures, well over the roughly 875,000 they needed. California allows ballot initiative campaigns to pay people per signature they gather. The cost of gathering petition signatures can vary widely, but it typically runs around $15 for each signature.

If the measure goes before voters in November, it could prompt one of the costliest ballot fights ever and will draw national attention as a litmus test for voter attitudes on raising taxes on the rich. An effort to oppose the tax has already raised millions and led to proposals designed to nullify the tax. Meanwhile, Vermont Sen. Bernie Sanders has campaigned in support of the idea.

Democratic Gov. Gavin Newsom and Silicon Valley tech moguls are adamantly opposed. They warn it will drive California’s wealthiest residents out of the state. Nearly half of California’s personal income tax revenue comes from the top 1% of earners. Some have already purchased properties out of state in case it passes.

“After playing with matches since October the SEIU has succeeded in lighting a ‘Tax the Rich’ wildfire by getting enough signatures,” said David Lesperance, a tax consultant who’s advised some of his wealthy clients who left California because of the proposal. “The many billionaire targets of their efforts have already responded by executing fire escape plans by relocating to other states.”

Brian Brokaw, a longtime Newsom adviser who is leading a political committee opposing the tax, said the measure was poorly constructed and would deal a huge blow to the state’s budget.

“Enacting a so-called wealth tax in just one state wouldn’t target a small group — it would impact all 40 million Californians,” he said in a statement. “This proposal trades a short-term revenue bump for long-term losses.”

At least 25 billionaires listed among Forbes magazine’s 2025 rankings of the world’s 500 wealthiest people either lived in California or had some significant ties to the state, based on a review by The Associated Press. But determining whether they were full-time residents or just frequent visitors could turn into a matter of dispute, since many of them own property elsewhere.

The big tax and spending cuts law President Donald Trump signed last year will cut more than $1 trillion nationwide over a decade from Medicaid and federal food assistance.

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In a closed-door discussion this week, representatives for Assembly Speaker Robert Rivas (D-Hollister) met with the leaders behind the Californians for Safer Communities Coalition, the group led by local district attorneys that has spent the last six months campaigning for voter support to reform Proposition 47, which voters passed in 2014.

Two people with knowledge of the meeting said legislative leaders are moving forward with a hard-ball approach that would make voters choose between the two efforts — and could splinter support for the ballot measure.

Unless the ballot measure is withdrawn, the Democratic leadership plans to add an “inoperability clause” to its legislation that would revoke the new laws if voters pass the statewide proposition in November, according to the sources and a letter Republicans sent to legislative leaders.

The Republican lawmakers in the letter condemned those changes, saying they would “do grave damage” to the bipartisan progress made on retail theft. Lawmakers are advancing a bipartisan 12-bill legislative package that would address the issues of retail theft and focus on protecting the safety of workers and store owners, without harsher penalties for some offenders.

The proposed ballot initiative takes a different approach that would revise Proposition 47 to make possession of fentanyl into a felony, and repeat offenders who steal for the third time — regardless of the value of the product stolen — could serve up to three years in state prison. A spokesperson for the ballot measure campaign declined to comment about the meeting.

“The Speaker has done more in eight months than anyone has done in eight years to push the conversation forward and I think everyone in the room acknowledges that,” said Daniel Conway, vice president of government relations for the California Grocers Assn., who was present during the discussions this week. “And that is why there is a bona fide effort to see what can be done.”

Both the proposed legislation and ballot measure focus on the need to address retail theft. But over the last several months, disagreements have been mounting over the best path forward. Gov. Gavin Newsom made it clear that he does not want proposed reforms to Proposition 47 on the November ballot, saying effective changes can be made through the legislative process instead. But law enforcement groups and conservative prosecutors say the only way to enact substantive changes is by bringing it back to the voters.

California voters approved Proposition 47 in 2014 to reclassify some felony drug and theft offenses as misdemeanors and to raise, from $400 to $950, the amount for which theft can be prosecuted as a felony.

The political jockeying and the change leaders plan to make to the legislation could potentially lead to splintering within the ballot measure coalition, which has had the backing of law enforcement groups and funding from major retailers.

The Grocer’s Assn., which represents over 6,000 food stores and grocery suppliers, is still supportive of both the ballot measure and legislation.

Rachel Michelin, president of the California Retailers Assn., told The Times that she supports the legislative package and thinks it does more for retailers than the ballot initiative. But she is frustrated at the politics being played on all sides.

“I am just trying to provide resources to retailers and law enforcement to keep our customers safe,” she said. “Unfortunately, I don’t know whether the proponents of the initiative are going to budge. My fear is we lose all of these things in the package if they move forward to initiative. That would be detrimental.”

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