California voters rejected Proposition 40 in an Associated Press race call during counting, amid a tech-backed campaign against the proposed wealth tax, which would have directed most proceeds to health care.
The Associated Press called the result Nov. 9, six days after the election. California’s Secretary of State is scheduled to certify the results Dec. 11, so the call preceded official certification.
The Guardian estimated that the opposition effort raised nearly $425 million to defeat Proposition 40. California Fair Political Practices Commission (FPPC) records list Google co-founder Sergey Brin and L. John Doerr, III, among the top donors to Building a Better California, a committee that opposed Proposition 40 and supported Propositions 41 and 42. Former Google CEO Eric Schmidt also appears among the committee’s leading donors in other FPPC entries.
Proposition 40 proposed a one-time tax generally equal to 5% of covered net worth for eligible California billionaires and certain trusts, with a reduced rate for individuals near the $1 billion threshold. California residency was determined as of Jan. 1, 2026. Wealth would have been valued on Dec. 31, 2026. Covered billionaires would have paid the tax, while public health care was to receive 90% of proceeds; education, food assistance and tax administration would have received the rest.
The California Legislative Analyst’s Office estimated that the levy could generate tens of billions of dollars over several years, while changes in taxpayer behavior might lower annual state income-tax receipts by less than $1 billion. EconoTimes previously examined the measure’s disputed fiscal effects.
Proposition 41 would have barred new state taxes whose revenue is excluded from the state spending limit and required audits of programs funded by certain new taxes. Proposition 42 would have prohibited new taxes on financial assets and other personal property, as well as certain retroactive taxes.
SEIU-UHW Chief of Staff Suzanne Jimenez said health care workers would pursue “every available avenue” if lawmakers failed to protect patients and deliver a solution requiring billionaires to pay more. The campaign statement said a return to the ballot in 2028 was one possibility.
