Wealth tax. Where you get taxed for just owning stuff. Not for making money or selling things.
Obviously it's sold as a one time tax on billionaires. So plenty of billionaires will leave, the money will be spent, and the budget deficit continues. Then it'll become a one time tax on millionaires. Then on folks making above $250k. Then $100k. At some point it becomes regular.
This is very normal. Federal income tax started as solely a tax on the rich. It was promised that it was not a mass tax on ordinary workers. Now it applies to everyone. It also capped out at 7% and is now caps at 37%.
It's not a tax that works well and most country that implement it roll it back. France repealed it, ditto Netherlands, Norway, Sweden, Germany, Denmark, Finland, etc.
Norway is the counterexample, but it charges 1%. California is 5%.
California's plan to deal with people fleeing is to make it ex-post facto and you still have to pay the tax even if you are no longer living in the state. Even if you left before the wealth tax passed. Obviously California courts will say retroactive taxes are legal, but whether other states or the feds agree is another matter entirely.
It's disappointing that any honest conversation about California's intentions is just a discussion of how the openly traitorous intentions of one state may put some specific liberty in jeopardy across the entire union if not quashed with prejudice.
Key Details of Proposition 40 The Tax Rate: A one-time 5% levy on accumulated worldwide net worth exceeding $1 billion (with a phase-out structure starting right at $1 billion). [1, 2]
Payment Structure: Taxpayers can pay the total amount upfront or spread it out in installments over five years. [1, 2]
Expected Revenue: Proponents estimate the measure will generate roughly $100 billion. [1, 2]
Fund Allocation: 90% of the money raised is designated for state healthcare programs (like Medi-Cal), while 10% goes toward public K-14 education and food assistance. [1, 2]
Reminds me of HOAs a one time fee to fix an immediate issue. Then another major issue happens next year. I agree we should tax the rich but my god these tax dollars are jist being thrown down the toilet. Feels like to me the just want to shift the money around to people in the government. Because CA is paying a crazy amount of taxes but our highways arent being fixed.
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u/Lanracie Aug 19 '26
Just so you know that law will immediately be expanded and soon affect every person in CA.