California billionaire tax could backfire, Stanford study says
Summary
California voters will soon decide on a new tax that would charge billionaires 5% of their wealth to raise money for healthcare. A study by Stanford economists warns that many billionaires have already left the state, which could reduce the money collected and cause California to lose more tax income in the future.Key Facts
- California is considering a "billionaire wealth tax" to support its healthcare system.
- The tax would charge a one-time 5% state tax on billionaire wealth.
- Seven billionaires have left California, removing about $540 billion from potential taxes.
- These departures include Peter Thiel and Google co-founders Larry Page and Sergey Brin.
- The tax is expected to raise around $30 billion, lower than the $100 billion originally estimated.
- Future income tax losses from billionaires leaving could cost the state $1 billion to $3.5 billion each year.
- Some economists support the tax, saying it will help fund public services like education and infrastructure.
- Polls show voters are divided, with about 46% for and 43% against Proposition 40, the ballot measure.
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