California's 'billionaire tax' splits Democrats ahead of Tuesday's vote as critics warn the rich will flee the state

California's proposed wealth tax would target unrealised capital gains and large fortunes directly, with analysts warning a "yes" vote could accelerate the exodus of high-net-worth residents.

Mark Zuckerberg and his wife as Proposition 40, a one-off 5 percent levy on Californians worth more than $1.1 billion, faces a Tuesday vote with polls showing limited support.

Proposition 40, a one-time 5 percent levy on Californians worth more than $1.1 billion, goes to a statewide vote on Tuesday, with polls showing only limited support and some surveys suggesting it could fail outright. Backers, including Bernie Sanders and major unions, say it would raise roughly $100 billion over five years to fund healthcare and education gutted by federal cuts. But the Democratic coalition is fractured, with teachers, doctors and firefighters warning the tax could damage the state budget long-term by driving entrepreneurs away.

Two rival counter-measures — Propositions 41 and 42 — placed on the ballot by opponents would nullify Proposition 40 if approved.

The tax is back-dated to Jan. 1, 2026, specifically to capture revenue from any billionaire who leaves California after that date.

Backers see the vote as a launchpad for a national wealth tax, but many Democrats across the country have kept their distance as they assess the political risks.

wsj.comCalifornia’s Proposal to Tax Billionaires Has Become a Mess for Democrats theepochtimes.comCalifornians to Vote on Proposed Billionaire Tax The TelegraphCalifornia’s wealth tax vote has set billionaires up to lose The TelegraphCalifornia’s billionaire tax will only speed the state’s decline The HillBillionaire tax divides California Democrats, draws myriad questions NYTOn the Ballot in California: The Prospects for a National Wealth Tax

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