Summary
California is considering a new tax proposal targeting billionaires to raise funds for public services. Some billionaires have expressed concerns that the wealth tax might lead them to leave the state, which could reduce California's tax revenues. The proposal suggests a one-time 5% tax on individuals with a net worth over $1 billion.
Key Facts
- California has the most billionaires of any U.S. state, with over 80 on the Forbes 400 list and around 200 in total.
- The proposed tax, called the 2026 Billionaire Tax Act, would see a 5% tax on assets for those worth over $1 billion.
- The tax could be paid over five years as an option.
- Supporters believe the tax could raise billions for health care, education, and other public services.
- Opponents, including some billionaires, warn it could drive wealthy residents out of California.
- Oculus founder Palmer Luckey and LinkedIn cofounder Reid Hoffman criticized the proposal for potential economic harm.
- Hedge fund manager Bill Ackman and former "Shark Tank" investor Mark Cuban expressed concerns about wealth taxes.
- Tesla CEO Elon Musk highlighted that his wealth is tied up in stocks, not cash.
- Venture capitalist Vinod Khosla predicted key business figures could leave California.
- Nvidia founder Jensen Huang expressed support for the proposal.
