A major labor union is pushing a one-time wealth tax proposal onto the California ballot this November, aimed squarely at the state's billionaires. The California Billionaire Tax Act seeks to generate revenue for a healthcare system facing significant strain from federal funding cuts.
The initiative, spearheaded by Service Employees International Union-United Healthcare Workers West, received its official title and summary from Attorney General Rob Bonta, clearing the path for signature collection. Senator Bernie Sanders has publicly endorsed the proposal, framing the tax as "pocket change" for the ultra-wealthy.
However, the act faces opposition. Governor Gavin Newsom has voiced concerns, and Representative Kevin Kiley plans to introduce legislation against it, arguing it could drive away job creators. Meanwhile, Los Angeles County leaders are pursuing a separate temporary sales tax increase to address healthcare funding shortfalls.
Under the proposed act, Californians with a net worth of $1 billion or more, along with certain trusts, would face a one-time 5% tax. This is estimated to affect approximately 200 individuals.
The revenue generated would be allocated to urgent healthcare, education, and nutrition needs. Ninety percent would fund the Billionaire Tax Health Account, supporting restoration of funding cuts, Medi-Cal enhancements, and facility preservation. The remaining 10% would go to the Billionaire Tax Education and Food Assistance Account, earmarked for education and food security programs.
The tax would be due in 2027, with an option for a five-year payment plan at a higher cost. While exact revenue projections are difficult due to potential actions by taxpayers, the tax is expected to collect tens of billions of dollars.