California’s Proposition 40, which would have imposed a one-time 5% tax on billionaire wealth in the state, was defeated at the ballot box, while a competing measure backed by wealthy tech executives to ban billionaire taxation appears poised for approval.
The opposition campaign, funded by Silicon Valley’s most prominent figures, raised nearly $425 million according to campaign finance filings, making it the costliest opposition effort in California history. Google co-founder Sergey Brin contributed at least $132 million to the effort, with former Google CEO Eric Schmidt donating more than $48 million. Additional major donors included executives from technology and financial companies including Palantir, DoorDash, Stripe, and Reddit, as well as prominent venture capitalists. The pro-tax campaign, sponsored by the union SEIU-United Healthcare Workers West, raised just over $31 million, resulting in an approximately 14-to-1 spending disadvantage.
Proponents of Proposition 40 argued the revenue would address healthcare funding losses resulting from federal policy changes. Opponents countered with an extensive advertising and mail campaign, characterizing the measure as an “everyone tax” and “reckless experiment” while arguing it would worsen healthcare funding. The campaign narrative also faced headwinds from major state political figures, including Governor Gavin Newsom and Governor-elect Xavier Becerra, who opposed the measure.
Geographic voting patterns revealed stark divisions, with counties typically aligned with Democratic politics and containing concentrations of wealthy residents—including Los Angeles, San Francisco, and Bay Area areas—voting in favor, while predominantly rural and Republican counties voted overwhelmingly against the proposal. Some observers compared the campaign spending to other high-profile ballot measure fights in recent years, including ride-hailing companies’ 2020 labor-related campaign that exceeded $200 million. Union leadership indicated the organization would pursue additional ballot measures if state policymakers did not implement alternative solutions to address healthcare funding gaps.
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