California voters face a Nov. 3 decision on a billionaire tax whose projected receipts range from about $30 billion to $100 billion, while researchers dispute whether departures would leave lasting income-tax losses.
Proposition 40 would apply to people who lived in California on Jan. 1, 2026, and had more than $1 billion in covered wealth. The one-time levy could reach 5% of covered assets measured at the end of 2026. Taxpayers could pay in 2027 or spread payments over five years for an additional cost. Covered holdings include businesses, securities, art, collectibles and intellectual property; real estate and some pensions and retirement accounts are excluded. The state voter guide allocates 90% of proceeds to health care, with the balance for education-related programs and food assistance.
Researchers Jasper Boll, Emmanuel Saez and Gabriel Zucman estimate about $100 billion in receipts, with relatively little effect on income-tax revenue. In their benchmark, they start with a Forbes wealth valuation of $2.182 trillion dated April 15, 2026, then account for 10% avoidance or evasion. That calculation yields $98 billion.
Researchers Benjamin Jaros and Joshua Rauh put direct collections at $28 billion to $36 billion, or about $30 billion. Their estimate incorporates their finding that reported moves had reduced the tax base they analyzed by nearly 30%, along with a discount for litigation risk. Whether those moves had legally changed taxpayers’ California residency by Jan. 1 is unverified.
Jaros and Rauh separately calculate a negative $38.9 billion net present value by comparing the one-time levy with income-tax revenue they project California would permanently lose. That is not a tax-collection estimate. In 85% of their 100,000 simulated outcomes, the net present value was negative.
In a March response to an earlier Rauh analysis, economists Brian Galle, David Gamage, Emmanuel Saez and Darien Shanske argued that reported moves alone did not establish a change in residency. They also criticized the analysis for treating the wealth tax as one-time while projecting permanent income-tax losses. Their response addressed an earlier version of the Rauh work.
The California Legislative Analyst’s Office projects temporary proceeds in the tens of billions of dollars across several years and says billionaire income-tax revenue could fall by less than $1 billion annually. It cites changing asset values and taxpayer responses as reasons the total is difficult to estimate. The office also says administration could cost tens of millions of dollars per year for several years. If voters approve Proposition 40 on Nov. 3, the tax would be due in 2027.
