California Voters Reject 5% One-Time Billionaire Tax After a Nearly $425 Million Opposition Campaign

California voters rejected Proposition 40, a proposed one-time 5% tax on the wealth of billionaires, according to a race call by The Associated Press that NPR reported on Monday, Nov. 9. Opponents spent nearly $425 million against the measure, the most expensive opposition campaign in state history, The Guardian reported.

Related: Justice Department Moves to Drop Suit Over 20,000 Disputed California Ballots.

What the measure would have done

Proposition 40 would have applied to Californians with a net worth above $1 billion as of Jan. 1, 2026, The Guardian reported. The healthcare union SEIU-United Healthcare Workers West sponsored it.

Proceeds would have funded health care programs, along with some education and food assistance, according to The Guardian. Supporters said the tax could raise $100 billion for health care, NPR reported.

Advocates argued that Congress had cut health care programs to give tax breaks to the wealthy, according to NPR. The state has more than 200 billionaires by some estimates, the outlet reported.

Opponents argued the tax would drive wealthy residents out of California and cost the state revenue, NPR reported.

A measure that split Democrats

The California Democratic Party backed Proposition 40, as did Rep. Ro Khanna and Sen. Bernie Sanders of Vermont, according to NPR.

Gov. Gavin Newsom opposed it, saying a national tax on the wealthy would be better, NPR reported. Democratic gubernatorial candidate Xavier Becerra also opposed it. The Guardian reported that the Republican candidate for governor opposed the measure as well.

A leading teachers union was against the proposal, which set aside only a small share of revenue for schools, NPR reported. Planned Parenthood Affiliates of California also opposed it, The Guardian reported, citing the tax’s one-off structure.

The money and the counter-measures

Sergey Brin, a Google co-founder, was the largest donor to the opposition, contributing at least $132 million, The Guardian reported, citing campaign finance filings. Executives from Google, Palantir, DoorDash, Stripe and Reddit were also among the donors.

Spending topped $2.5 million a day in the first two weeks of October, according to The Guardian. NPR reported that at least five times as much was spent opposing the measure as supporting it.

Opponents also placed two counter-measures on the ballot, Propositions 41 and 42, The Guardian reported. Either one would have blocked the tax if it drew more yes votes than Proposition 40. Supporters of the tax called them “poison pills.”

What comes next

The Guardian reported that the result could hamper efforts in other states to enact new taxes on the ultra-wealthy.

Race results are on our 2026 midterm election tracker. More national coverage is on the politics and government page.

Sources

• NPR: California voters defeat billionaire tax proposal that divided Democrats
• The Guardian: California voters fail to pass proposed one-time tax on billionaires’ wealth

About the reporter: Marcus Hale is an AI reporter covering U.S. politics and government for The Boston Report. This article was produced with AI under our editorial policy. Read our AI and media disclosure.