Billionaires Spend $300 Million to Block California One-Time Asset Tax

California voters will head to the polls on November 3 to decide whether to levy a one-time 5 percent tax on the assets of the state's billionaire residents.

The campaign against the measure, known as Prop 40, has become the most expensive ballot measure fight in state history, according to David McCuan, a political science professor at Sonoma State University. Opponents have raised more than $300 million to block the tax, while supporters have collected only $32 million.

The opposition includes high-profile tech figures such as Google co-founder Sergey Brin, DoorDash founder Tony Xu, and Stripe co-founder Patrick Collison. Venture capitalists John Doerr, Michael Moritz, and Vinod Khosla have also contributed to the anti-tax effort. Meta founder Mark Zuckerberg has not donated directly to the opposition, but Meta's SEC filings reveal he informed the board he would buy a home outside California to avoid the levy. The board subsequently created a new class of shares for Zuckerberg to use for payment, a move intended to prevent stock price volatility.

The intense advertising campaign has created confusion among some residents. Brian Galle, a University of California at Berkeley economics professor who helped draft the proposal, said he received a flyer claiming the tax could apply to retirement savings, a provision he said he did not include. Ashley Craig, a volunteer with the pro-tax group Patriotic Millionaires, reported that voters frequently cite secret provisions that would tax everyone. Any modification to the tax requires a two-thirds majority in the state assembly.

McCuan noted that the spending highlights a tension in the political system, stating that billionaires are using their wealth to avoid the democratic equality the tax aims to foster. Francesco Trebbi, a professor at Berkeley's Haas School of Business, described the contest as a battle between Sergey Brin and millions of Californians. The fight has also exposed divisions within the Democratic Party, with the state party endorsing the tax while Governor Gavin Newsom opposes it. Newsom, who is considering a 2028 presidential run, called the measure poorly written and warned it could drive billionaires out of the state.

Opponents have also placed two related measures on the ballot. One bars new state taxes on personal property or those applied retroactively, while the other requires state auditors to review proposed tax measures for financial impact before a vote. If either measure passes with more votes than Prop 40, it could negate the billionaire tax even if voters approve it. A recent Public Policy Institute of California poll found that voters narrowly support the tax but also back the measures designed to stop it.

Suzane Jiminez, chief of staff at the SEIU health workers union which sponsored the measure, expressed confidence in the campaign. She noted that 3,000 volunteers have recently been knocking on doors and distributing flyers across the state. Senator Bernie Sanders and Congressman Ro Khanna have also rallied support for the initiative. McCuan suggested that even a defeat could benefit backers, who could use the result to target big tech in future political cycles.