Proposition 42: Ban on new property-ownership taxesBans new state taxes on owning financial assets and other personal property, and some retroactive taxes
Read the full text of the measure: Official Voter Information Guide (PDF)
In plain words
"Personal property" means things you own other than land and buildings, like stocks, savings, business shares or art. California taxes income from them, but not just owning them. This would ban any new state tax on owning them. It also limits "retroactive" taxes, meaning taxes on things that happened before the tax passed. Existing taxes like the vehicle license fee stay. If it gets more yes votes than Prop. 40, a court could block Prop. 40. (lao.ca.gov (Legislative Analyst's Office) )
Before and after
| Question | Today | If it passes |
|---|---|---|
| Can the state create a new tax on owning stocks, savings or other personal property? | Yes, with voter or legislative approval | No |
| Retroactive state taxes | Allowed in some cases | Limited |
| Existing taxes like the vehicle license fee | Stay | Stay |
Numbers from the official ballot title (ballot title ); also see (lao.ca.gov (Legislative Analyst's Office) )
Biggest change
- Bans new taxes on owning financial assets or other personal property and limits retroactive taxes. source: lao.ca.gov (Legislative Analyst's Office)
- Applies to new taxes enacted or taking effect on or after Jan. 1, 2026, and says conflicting measures on the same ballot are void if it gets more yes votes. source: sos.ca.gov (Official Voter Information Guide)
Who it affects most: People with large investments or other valuable property, and the outcome of Prop. 40.
Cost to the state: Possibility that tax revenues will not go up as much in the future; when or by how much is unclear (Legislative Analyst).
Our plain-words summary. Every line points to its source.
What your vote means
The state could not create new taxes on owning stocks, savings or other personal property, and retroactive taxes are limited.
The state keeps the option to create such taxes in the future.
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.
- Opponents of the billionaire tax (Prop. 40) placed Prop. 42 on the ballot. 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 42 gets more yes votes than Proposition 40, courts could find that they conflict, which could block Proposition 40 even if it passes (Legislative Analyst). source: lao.ca.gov (Legislative Analyst's Office)
Why supporters want it
- Official argument in favor: "Prop. 42 requires any new taxes to apply only after voters have approved them"; supporters say it protects 401(k)s, pensions, IRAs and savings from double taxation. Signed by Michael Hedges (California Small Business Association), Shelley Huff (AMVETS, Department of California) and Jennifer Yoder (California Senior Alliance). source: voterguide.sos.ca.gov (Secretary of State)
Why opponents object
- Official argument against: "Prop. 42 isn't about preventing new taxes on personal property"; opponents say it was designed to undo Prop. 40, naming Sergey Brin as a major funder. Signed by Suzanne Jimenez (SEIU-United Healthcare Workers West). source: voterguide.sos.ca.gov (Secretary of State)
Who backs each side
- For: CA Professional Firefighters, State Building & Construction Trades Council of CA, AMVETS Department of CA, Peace Officers Research Association of California, Building a Better California, Reform California, Sergey Brin. Against: U.S. Sen. Bernie Sanders, SEIU-UHW, California Democratic Party. source: CalMatters
- Money (Secretary of State, through Aug. 2, 2026): "Yes on 42 - Protect Retirement & Life Savings" reported $49,277,037. No opposing committee was identified on that page. 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 .
PROHIBITS NEW STATE PERSONAL PROPERTY TAXES AND CERTAIN RETROACTIVE STATE TAXES. INITIATIVE CONSTITUTIONAL AMENDMENT.
YES
NO
Official title copied word for word from the Official Voter Information Guide (page 62). The title and summary are prepared by the Attorney General.
Official summary by the Attorney General (tap to open)
Prohibits new state taxes on personal property, including business interests, intellectual property, and financial assets (including assets in retirement and investment accounts). Prohibits new state taxes that apply retroactively based on the taxpayer’s conduct, activities, or a status that occurred before the new tax’s effective date. Applies to new taxes that are enacted or take effect on or after January 1, 2026. States that other voter-approved measures appearing on the same ballot are void if they conflict with this measure and this measure receives more affirmative votes.(sos.ca.gov (Official Voter Information Guide) )
Latest news
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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 42
- Official arguments and rebuttals
- Legislative Analyst's analysis
We link to analysis from several sources; we don't endorse it.