Did you know about this… there’s a big effort to enact a “Billionaire Tax” in California? Maybe you’re not in California but this has the potential of changing things across the country (especially if Gavin Newsom gets elected President). Maybe you live in California but aren’t a billionaire… could this still impact you?
I explore all this in the video at the bottom of this page… but here are the highlights and links (click the webpage images) to resources that I refer to.
What is California's Billionaire Tax?
There’s a ballot measure that is currently in the signature-gathering phase that, with enough signatures (only 874,641 are needed), would tax the California residents who have at least a net worth of $1 billion of assets. The tax would be applied one time and would tax 5% of their assets. An additional separate $1 billion tax would be applied when there are assets of $20 billion or more.
Let’s get into some of the details…
Forbes: Possible California Wealth Tax Causes Billionaire Freakout
In addition to what was previously mentioned, this ballot measure is being pushed by SEIU Healthcare union and 90% of the money confiscated under this scheme goes to health care. The remaining 10% goes to “education-related programs.”
Once approved by a majority of voters (50%+1 of voters, not California residents), “the bill could be amended or repealed by state legislators”.
Wall Street Journal: The California Campaign to Introduce a First-of-Its-Kind Billionaire's Tax
This story is behind a pay-wall, but what we can see is that this reinforces reporting that this effort is backed by the Union and is “aimed at raising healthcare funding”.
Investment News: California's proposed 'Billionaire Tax' could reshape wealth planning...
The healthcare union indicates this measure is needed due to funding shortfalls from the Federal government (meaning, IT’S TRUMP’S FAULT).
This measure argues that California billionaires have “largely escaped fair taxation”.
DON’T MISS THIS… with its passage, ALL California resident would have to report to the state their total net worth… all of it… to include your real estate.
New York Post: Billionaires are plotting to flee California if huge wealth tax passes
The highlight here is that the healthcare union is the main force behind this measure and the funds will support public schools and “replenish health care funds lost to federal funding cuts”… meaning, ITS TRUMP’S FAULT.
Also, the union chief of staff calls this a “very minor tax”.
Slippery Slope of Income Tax
For context, let’s remember how the Federal income tax was initially sold to the people… it was touted as moving away from “regressive tariffs” and towards a “more progressive, ability-to-pay system”. The new income tax was meant to help the people and bring fiscal stability to the Federal government.
The Federal income tax was to be initially applied to the very wealthy… the top 3% of the population… and would only be a 1% tax on incomes over $3,000 ($99,221 in 2025 dollars) and a 6% surtax on incomes over $500,000 ($16,536,836 in 2025 dollars).
Fast-forward to today… who has to pay income tax (hint: it’s not the richest 3% of Americans)? Turns out that it’s individuals (almost everyone… see the following section), it’s corporations, estates, and trusts that earn income above specific thresholds.
For most Americans, if you make more than $14,600 a year, or $29,200 if married filing jointly, then CONGRATULATIONS… YOU ARE RICH!!
You are the wealthy! You are part of that ever-expanding 3% of the top income earners!
What Does Californian's Billionaire Tax Really Mean?
Let’s look at what we know:
- The SEIU healthcare union is behind this ballot measure
- “Healthcare” will receive 90% of this new tax revenue (on top of what they already get)
- “Education” will receive 10% of this new tax… an incentive for the education unions to do what they can to get this measure passed
- To get on the ballot, this measure needs about 870,000 signature; there are about 2.38 million union members in California (Google search)
- Once on the ballot, it needs a simple majority OF VOTERS to pass
- The measure says it is for one time only and only applies to California’s billionaires
- Once passed by the voters, this bill can be amended by state legislators (changes could be that this tax is applied annually and the threshold could be reduced from $1 billion to any other amount they want)
- The Federal income tax was sold to the people in 1913 as only applying to the top 3% of the wealthy (those making about $100,000 in today’s dollars)
- The Federal income tax today applies to anyone making more that $14,600
- This measure would require ALL California residents to declare their total net worth
- Forbes reports this measure applies to “net worth (that) exceeds $1 billion” and Investment News says this applies when “total assets exceed $1 billion”… so this measure could apply to assets without regard for liabilities
- The reason this measure is necessary is because of Trump
Treasure Valley Dave's Thoughts
Here’s my opinion… and I would like to know how you see things too… maybe I’m missing something: The healthcare union figured out a shake-down by the time-honored tradition of pitting one group against another. The education unions are incentivized to make this shake-down happen with some “10 percent for the Big Guy” action. Once passed by the voters, the legislature (which has a Democrat veto-proof supermajority in both chambers) can alter the bill from just one time to every year and lower the threshold from $1 billion to whatever amount they want… following the history of the Federal income tax… that threshold could easily ensnare the working poor. Also, this measure could go after assets regardless of liabilities (ask a business owner what this means!) and unrealized gains (such as the equity in your house even if you aren’t selling it… or the dollars in your investment or retirement accounts).
Again, my opinion; this measure is going to pass and the legislature is going to change it. Big businesses (employers) are going to leave and then medium size and smaller businesses are going to be forced to shut down or leave. There will be less of a tax base and everyone’s taxes will go up. So taxes go up, gas goes up (past $12/gallon), electricity goes up, home insurance goes up… but I’m sure your pay will go up too… right?
If you are not so confident that California is star-spangled awesome, then you might be thinking of making the escape… maybe thinking Idaho may be your happy place! If you have question and you want to know more, Mareen and I would be super excited to answer your questions and be your Treasure Valley resource. So, just call, text, email or smash that Contact Us button and let’s get connected! Maybe we can do lunch too! 
