California’s Proposition 40 support drops to 42% as billionaire-funded opposition spends $148M

What Proposition 40 proposes

California’s Proposition 40 aims to impose a one-time 5% tax on billionaires if approved by a majority of voters. The revenue would be allocated primarily to Medi-Cal, California’s Medicaid program, with 90% directed there. The remaining 10% would fund food assistance and education-related programs.

The tax would apply to approximately 200 billionaires in California, including high-profile figures in technology and finance. If passed, it would mark one of the most direct efforts by any U.S. state to tax extreme wealth.

Voter support declines sharply

Support for Proposition 40 has fallen from 54% in May to 42% in late October, according to recent polls. A University of California Berkeley Institute of Governmental Studies poll conducted October 19-25 showed 42% of voters in favor and 50% opposed. An earlier Public Policy Institute of California poll (October 16-22) found 46% support and 52% opposition.

The decline in support coincides with a massive spending campaign by opponents. The group Building a Better California, funded by billionaires including Google’s Sergey Brin and Eric Schmidt, has raised $379 million and spent $148 million—outspending proponents by a ratio of 250 to 1.

Opposition campaigns and messaging

Opponents of Proposition 40 argue that its passage could set a precedent for future taxes on non-billionaires. They have also introduced two additional ballot measures, Proposition 41 and Proposition 42, which are designed to negate Proposition 40 if it passes. Proposition 41 is polling evenly at 49% opposition and 48% support, while Proposition 42 holds a slight lead with 51% support and 47% opposition.

High-profile political figures, including Governor Gavin Newsom and Democratic gubernatorial candidate Xavier Becerra, oppose the measure. They claim that the tax could drive billionaires out of California, harming the state’s economy. Similar threats were made in New York during a mayoral race, though no significant exodus occurred.

Billionaire influence and threats of relocation

Meta CEO Mark Zuckerberg and others have suggested they might relocate if Proposition 40 passes. However, historical precedent suggests such threats are rarely acted upon. For example, millionaires in New York threatened to leave during a mayoral race involving Zohran Mamdani, but no mass departures followed.

The opposition’s spending advantage reflects broader concerns about the influence of wealth in shaping policy. Tech billionaires, in particular, have played a central role in funding campaigns against the tax.

What this means

Lazyfounder analysis — our interpretation, not reported fact.

Proposition 40’s decline in voter support highlights the challenges of passing wealth taxes in the face of well-funded opposition. For founders and operators, the outcome could signal how similar policies might fare in other states—or how aggressively tech leaders may push back against proposals that threaten their financial interests. The measure also tests the limits of public appetite for redistributive policies, particularly in states with high concentrations of wealth.

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