California voters will decide in November whether to approve a one-time 5% tax on residents with assets over $1 billion, after the California Billionaire Tax Act qualified for the statewide ballot. The measure, backed by SEIU-UHW, reached certification following the submission of more than 1.6 million signatures, setting up a statewide fight over revenue and economic impacts. Last update: June 27, 2026.

Supporters say the tax would raise $100 billion with most funds directed to healthcare and the remainder to food assistance and education, as a response to deep federal healthcare funding cuts. Opponents, including Governor Gavin Newsom and prominent tech executives, argue the levy risks driving wealth and businesses out of California potentially worsening budget volatility and undermining essential services.

Ballot measure and union backing

The sponsor, SEIU-UHW framed the measure as a narrow, one-time assessment affecting a small group of ultra-wealthy residents to stabilize hospital systems and avoid closures of emergency departments. Union leaders linked the initiative to addressing anticipated gaps after federal reductions in healthcare support, positioning the revenue as a stop-gap for vulnerable populations. Suzanne Jimenez of the union described the tax as a modest step to protect the state’s healthcare infrastructure and maintain access to critical services.

Certification followed the collection of over 1.6 million signatures exceeding the threshold for ballot access. Proponents emphasize that directing the majority of proceeds to health programs could buffer systems stressed by funding losses, with additional allocations to nutrition and education programs. Backers have also highlighted the limited scope of the tax, asserting it is designed to target asset holdings above $1 billion and deliver near-term fiscal relief to core social services.

Newsom’s opposition and calls for a federal solution

Governor Gavin Newsom publicly opposes the California Billionaire Tax Act, warning of the mobility of wealth and potential outmigration. In a direct appeal, Newsom wrote: “You may not be able to pick up and move to Texas or Florida to shelter your income from taxation, but I promise you that billionaires can, and do.” He added: “the fight to make the wealthiest Americans pay more in taxes should be fought at the federal level, where the broken system was created in the first place.”

Newsom’s stance has underscored a broader divide among Democrats and allied groups. Bernie Sanders and Ro Khanna endorsed the proposal as a reasonable step to counter wealth consolidation, while a coalition spanning healthcare, education, public safety, housing, business, and labor warned that the measure could increase revenue volatility. The governor’s office has also argued the tax is poorly designed and could constrain funding for essential public services.

Tech pushback, counter-measure and spending

Prominent tech figures, including Sergey Brin Larry Page and Peter Thiel, have invested heavily to defeat the ballot measure; Brin has spent tens of millions of dollars opposing it. A business coalition has funded the California Business Roundtable which advanced a separate ballot initiative to prohibit new taxes on retirement holdings and personal savings, intensifying the policy battle heading into November.

Opponents argue that imposing a wealth-based levy in a single state risks accelerating relocation to lower-tax jurisdictions, reducing investment and dampening growth in key sectors. Backers counter that the tax is both limited and time-bound, contending that the immediate infusion for healthcare and social programs outweighs potential capital flight, particularly given the targeted nature of the assessment.

Negotiations, rate proposal and campaign outlook

Talks between SEIU-UHW and the governor did not yield a compromise. The union offered to cut the proposed rate from 5% to 2% in exchange for the administration’s support, but the governor’s office rejected the proposal. That refusal prompted union criticism that the administration was siding with the state’s wealthiest residents over the healthcare funding plan.

With no deal and both sides preparing for substantial spending, the campaign is set to escalate. Supporters will focus messaging on hospital stability, emergency room capacity and food and education support, while critics will concentrate on economic competitiveness and fiscal volatility. The certified measure and the counter-initiative on retirement and savings taxes position California voters to decide not only the billionaire tax but a broader framework for future taxation and social investment in the state.