California Voters Weigh Proposition 40 Billionaire Tax

California voters decide this week whether to approve Proposition 40, a one-time 5% tax on billionaires living in the state as of January 1, 2026, in what the Guardian describes as one of the most contentious ballot measure fights in state history.

The midterm vote caps a year-long fight that has pitted Democrats against Democrats, drawn national political attention, and pulled tech billionaires into an open campaign against the measure, according to the Guardian.

What Does Proposition 40 Do?

Proposition 40 would levy a one-time 5% tax on California billionaires, with proceeds directed to healthcare programs and some education and food assistance spending, the Guardian reports. Supporters frame it as a direct response to federal healthcare cuts; critics, including some Democrats, have raised concerns about its structure as a one-off tax tied to a narrow set of programs, per the Guardian.

Who Proposed the Billionaire Tax?

The measure traces to Dave Regan, president of the healthcare union SEIU-United Healthcare Workers West, whom the Guardian calls the "divisive architect" of the billionaire tax. Regan has defended the idea against critics who called it unrealistic. "That's why we were willing to do something that lots of people said was crazy," Regan told the Guardian. "To us, what's crazy is doing nothing and watching millions of people lose coverage."

The push grew out of concern over federal Medicaid and Affordable Care Act funding cuts included in the One Big Beautiful Bill Act signed by President Donald Trump, which the Guardian reports could cause millions of Californians, including children, to lose healthcare coverage once the law takes effect in January.

Why Are Billionaires Fighting It?

The state's wealthiest residents have emerged as the measure's most vocal opponents, according to the Guardian, which reports that tech billionaires have treated Proposition 40 as an existential threat and have funded opposition campaigns, with leaked Signal chats among critics surfacing during the fight. The Guardian does not detail a single opposition spending figure beyond noting the scale of money involved in the broader campaign.

What Happens Next?

Voters decide the measure's fate in the midterm election, with the outcome determining whether California becomes the first state to enact a billionaire-specific one-time tax tied to healthcare funding, per the Guardian's reporting.

What to Watch

• Whether Proposition 40 passes or fails when midterm results are tallied
• Whether Democratic critics' objections to the one-off tax structure resurface in post-election debate
• Whether billionaire-funded opposition campaigns continue beyond Election Day
• Fallout from leaked Signal chats among opponents of the measure

Glossary

• Proposition 40: The California ballot measure imposing a one-time 5% tax on billionaires as of January 1, 2026.
• SEIU-UHW: SEIU-United Healthcare Workers West, the healthcare union led by Dave Regan that originated the billionaire tax proposal.
• One Big Beautiful Bill Act: The federal law signed by President Trump that cuts Medicaid, Affordable Care Act, and other healthcare funding, cited by the Guardian as the catalyst for the ballot measure.
• Billionaire tax: A tax targeted specifically at individuals classified as billionaires, distinct from broader income or wealth taxes.

The full Guardian report, including additional detail on the opposition campaign and the measure's legislative history, is available here.