California Prop 40 Results: Voters Decide on Billionaire Tax

Could California become the first state in the nation to impose a billionaire tax? Proposition 40 would raise money for the state’s healthcare system, which faces significant cuts under the One Big Beautiful Bill Act, by taxing the ultra-wealthy.

The proposal calls for a one-time 5% tax on the accumulated wealth of California taxpayers whose net worth exceeds $1 billion — roughly 250 people. If approved, Prop. 40 would apply to anyone who was a legal California resident on Jan. 1, 2026.

Related story: Live election results for 2026 California propositions

Here’s what to know about Prop. 40:

What do supporters of Prop. 40 say?

Supporters estimate the measure would raise $100 billion. About 90% of that money would be used to restore healthcare funding, while the remaining 10% would support food assistance and public education.

“Here in California, we’re finally saying to them: You have to put up a little bit of money — a one-time emergency tax — so millions of people don’t lose healthcare. That does not make you a victim; that makes you a participant in a society that’s made you incredibly wealthy,” said Dave Regan, president of the SEIU United Healthcare Workers Trust.

Regan’s union led the effort behind Prop. 40. He said that without action on the healthcare cuts, 3.5 million Californians could lose coverage, 20 million could face higher premiums, and some hospitals and clinics could be forced to close.

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“Neither Governor Newsom nor Secretary Becerra has offered a single idea to address an imminent healthcare crisis in California, and they all agree on what the consequences are going to be,” Regan said.

What do opponents of Prop. 40 say?

Prop. 40 faces opposition from a broad coalition that includes some of California’s most influential Democrats, including Gov. Gavin Newsom and gubernatorial candidate Xavier Becerra. Stuart Waldman, an advocate for economic growth and public policy who represents Los Angeles’ business community, said the state has a spending problem.

“Thirty-eight percent of our state budget comes from the top 1%. If those people moved — and some of them already have — it would have a drastic impact on our state budget. It would affect healthcare, teachers and education,” Waldman said.

Newsom has supported a federal wealth tax but criticized Prop. 40, warning that it could undermine California’s competitive position and encourage wealthy residents and businesses to leave the state.

Opponents have also questioned the measure’s structure. They object to directing 90% of the money to a single category, leaving out priorities such as public safety, housing and wildfire prevention. Some also argue that Prop. 40 could give future legislatures a path to expand taxes.