Politics
California Voters Reject Landmark 5% Billionaire Tax as Prop. 40 Fails
Proposition 40, which would have imposed a first-in-the-nation 5% one-time tax on California billionaires to fund healthcare, was defeated statewide 52.9% to 47.1%, though San Francisco voters backed it. The measure split labor groups and drew opposition from mainstream Democratic leaders.
California voters have rejected Proposition 40, a first-of-its-kind ballot measure that would have imposed a one-time 5% tax on the wealth of residents worth more than $1 billion, with most of the revenue directed to healthcare. The Associated Press called the race nearly a week after Election Day.
According to the California Secretary of State, the measure was failing statewide as of Monday night, with 5,789,026 votes against (52.9%) and 5,159,356 in favor (47.1%).
San Francisco voters diverged from the statewide result, backing the proposition by roughly 56% to 44%, according to the latest tally from the Department of Elections.
The proposal would have been the first tax of its kind in the United States, targeting the assets of the ultra-wealthy rather than income. Its defeat followed a campaign that split labor groups and drew opposition from mainstream Democratic Party leaders, who argued the measure could drive wealthy residents and jobs out of the state. Supporters had pitched it as a way to shore up healthcare funding by asking the state's wealthiest residents to contribute.
The outcome leaves California without a dedicated billionaire wealth tax and signals continued caution among statewide elected officials and voters about novel tax structures, even in a deep-blue state. For San Francisco, the result highlighted a persistent gap between the city's progressive electorate and the broader statewide mood.
The measure's failure also raises questions about how healthcare programs that supporters hoped to fund will be sustained, and whether organized labor and progressive groups can regroup around alternative revenue proposals in future elections.