▲ California's billionaire tax (File photo)
The so-called "billionaire tax" initiative, which sought to impose a wealth tax on ultra-high-net-worth individuals in California, appears likely to fail.
According to outlets including the Los Angeles Times (LAT) and the San Francisco Chronicle (SFC) on November 3 (local time), Proposition 40, which centers on levying a wealth tax, is leaning toward defeat with 43.5 percent in favor and 56.5 percent opposed, based on roughly 53 percent of the votes counted.
The ballot measure stipulated a one-time 5% tax on assets for California billionaires with a net worth of 1 billion dollars (approx. 1.34 trillion won) or more as of January 1, 2026.
Labor groups such as SEIU-UHW (Service Employees International Union - United Healthcare Workers West), a U.S. healthcare union, had previously stated that the approximately 100 billion dollars secured through the tax should be used for healthcare support for low-income families, education, and food assistance to make up for federal health budget cuts made by the Donald Trump administration.
However, amid strong opposition from Silicon Valley heavyweights including Google co-founder Sergey Brin, current Governor Gavin Newsom (Democrat), and newly elected incoming Governor Xavier Becerra (Democrat) both expressed opposition, failing to secure majority public sentiment.
The initiative's drift is also expected to have been influenced by internal divisions within the labor camp that originally proposed it, with some unions voicing opposition, as well as lawsuits and complaints filed by union members against SEIU-UHW President Dave Regan.
Even if further vote counting tips the scales in favor of the measure, additional hurdles remain before the wealth tax clause can actually take effect.
This is because the opposing camp, "Build a Better California," has put forward two counter-measures to neutralize the wealth tax.
Proposition 41 includes provisions banning new special taxes that bypass state spending limits, while Proposition 42 blocks the establishment of a new wealth tax on personal property and retroactive taxation.
For the billionaire tax to be introduced, not only must Proposition 40 receive more "yes" votes than "no" votes, but the approval rate for Proposition 40 must also exceed the approval rates for Propositions 41 and 42.
For Proposition 41, with about 52 percent of the vote counted, opposition is leading at 52.3 percent, whereas Proposition 42, supported by Governor Newsom, showed 54.6 percent in favor based on roughly 53 percent of the ballots checked.
Ultimately, even if votes in favor of Proposition 40 reach a majority, the billionaire tax would still be difficult to implement if its approval rate falls below that of Proposition 42.
As defeat loomed, President Regan signaled his intention to try again in two years.
He stated, "If Prop 40 fails, and if the state fails to deliver a solution that makes billionaires pay their fair share toward the healthcare crisis caused by the federal government, California healthcare workers will return to the ballot in 2028 to fix this harm."
Meanwhile, Proposition 39, a Republican-backed ballot measure that sought to mandate photo identification and citizenship verification at polling places, was defeated in this vote.
(Photo: AP, Yonhap News)
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