Proposition 40: Billionaire taxOne-time 5% tax on the wealth of California billionaires, mainly for health care
Read the full text of the measure: Official Voter Information Guide (PDF)
In plain words
"Net worth" means what you own (stocks, businesses, investments) minus what you owe. This charges billionaires who lived in California on Jan. 1, 2026 a one-time tax of up to 5% of their covered assets, such as businesses, stocks, art and collectibles. Real estate and some pensions and retirement accounts are not counted. It is due in 2027, or can be spread over five years at a higher total. 90% must go to public health care; 10% to education, food aid and running the tax. The money would not count under the state spending limit or the school funding formula. If Prop. 41 or Prop. 42 gets more yes votes, a court could block Prop. 40 even if it passes. (lao.ca.gov (Legislative Analyst's Office) )
Before and after
| Question | Today | If it passes |
|---|---|---|
| Tax on wealth (what people own) | None in California | One-time tax of up to 5% on covered assets over $1 billion |
| Who pays | Not applicable | About a few hundred people who lived in California on Jan. 1, 2026 |
| When | Not applicable | Due 2027; can spread over 5 years at higher cost |
| Where the money goes | Not applicable | 90% public health care; 10% education, food aid and administration |
Numbers from the official ballot title (ballot title ); also see (lao.ca.gov (Legislative Analyst's Office) )
Example
Illustration only: a resident with $2 billion in covered assets would owe up to 5%, or up to $100 million, one time. (lao.ca.gov (Legislative Analyst's Office) )
Biggest change
- One-time tax of 5% of net worth on billionaires who were California residents on Jan. 1, 2026; 90% for public health care. source: lao.ca.gov (Legislative Analyst's Office)
Who it affects most: California's billionaires, who would pay it, and people who rely on Medi-Cal and other public health care programs.
Cost to the state: Temporary revenue increase of tens of billions of dollars over several years; possible ongoing state income tax losses, likely under $1 billion a year, if billionaires leave or change their income; administration costs of tens of millions a year paid from the tax (Legislative Analyst).
Our plain-words summary. Every line points to its source.
What your vote means
California billionaires pay a one-time tax of up to 5% of their covered assets, mostly for health care.
No wealth tax on billionaires is charged.
Our one-line summary. The official "What your vote means" statements are in the Secretary of State's Official Voter Information Guide, linked below.
Why people want it, and why others object
Why this is on the ballot
Voters put this on the ballot by signing a petition. It changes the state constitution, so only another statewide vote can change it back. It passes with a simple majority.
- SEIU-United Healthcare Workers West put it on the ballot. It projects about $100 billion over five years and says federal Medi-Cal cuts will close hospitals and clinics. source: CalMatters
Touches the state's tax-limit rules: California's spending limit and local tax votes, in plain words, explained.
Conflicts with another measure
- If Proposition 41 or Proposition 42 receives more yes votes than Proposition 40, courts could find a conflict that blocks Proposition 40 even if it wins a majority (Legislative Analyst). source: lao.ca.gov (Legislative Analyst's Office)
Why supporters want it
- Official argument in favor: "billionaires pay much lower rates than working families"; it would raise about $100 billion to replace federal health care cuts. Signed by Suzanne Jimenez (SEIU-United Healthcare Workers West), Victoria Barron (Planned Parenthood of Pacific Southwest) and Denise Robb (AFT Local 1521). source: voterguide.sos.ca.gov (Secretary of State)
Why opponents object
- Official argument against: "This measure is a one-time tax that only provides temporary funds." Opponents cite a Stanford economists' study projecting a $25 billion revenue loss as wealthy residents leave. Signed by René Bravo, M.D. (California Medical Association), Francisco Silva (California Primary Care Association) and Dr. Debra Schade (California School Boards Association). source: voterguide.sos.ca.gov (Secretary of State)
Who backs each side
- For: SEIU-UHW, U.S. Sen. Bernie Sanders, Teamsters California, AFSCME California, California Labor Federation, California Democratic Party. Against: California Business Roundtable, California Medical Association, California Teachers Association, Planned Parenthood, California Professional Firefighters, State Building and Construction Trades, Chris Larsen, Ron Conway. The official argument against says Gov. Gavin Newsom and both candidates for governor oppose it. source: CalMatters
- Money (Secretary of State, through Oct. 6, 2026): committees in support reported $32,213,823 (mostly SEIU-UHW's "Yes on 40" committee, $31,510,329). Committees in opposition reported $99,596,279 (largest: "No on Prop 40 - Doctors, Teachers, Small Businesses..." $88,721,279; "Golden State Promise" $10,450,000). source: sos.ca.gov (Secretary of State)
In each side's own words where we could find them, quoted or summarized with a link to the source. We don't endorse either side.
What you will see on your ballot
Official ballot wording, word for word (tap to open)
The official ballot title, word for word from the Secretary of State's Official Voter Information Guide .
IMPOSES ONE-TIME TAX ON CERTAIN TAXPAYERS. INITIATIVE CONSTITUTIONAL AMENDMENT AND STATUTE.
YES
NO
Official title copied word for word from the Official Voter Information Guide (page 54). The title and summary are prepared by the Attorney General.
Official summary by the Attorney General (tap to open)
Imposes one-time tax of up to 5% on certain taxpayers with covered assets valued over $1 billion; covered assets include businesses, securities, art, collectibles, and intellectual property, but exclude real property and some pensions and retirement accounts. Allocates 90% of these tax revenues for health care, 10% for food assistance or education-related programs; prohibits using revenues to replace existing funding for these purposes. Exempts such tax revenues from constitutional requirements for school funding, budget reserves, and state spending limit.(sos.ca.gov (Official Voter Information Guide) )
Latest news
Recent reporting from a range of outlets, newest first. We link to it; we don't endorse it.
No articles collected yet for this measure.
Full text of the measure
The full text of the proposed law is printed in the Official Voter Information Guide. Read it in the Official Voter Information Guide (PDF) .
Read more
- Secretary of State: Official Voter Information Guide, Nov. 3, 2026 (PDF)
- Official Voter Information Guide: Proposition 40
- Official arguments and rebuttals
- Legislative Analyst's analysis
We link to analysis from several sources; we don't endorse it.