California's billionaire tax: What's at risk for the biggest state economy in America

California voters will decide in November 2026 on a one-time 5% wealth tax on residents and trusts with net worth over $1 billion, the first such tax in the U.S. The proposal, backed by the SEIU and designed to offset healthcare cuts from President Trump's 'Big Beautiful Bill,' would generate tens of billions in initial revenue. However, Governor Gavin Newsom, a 2028 presidential hopeful, opposes it, warning that wealthy individuals and businesses may leave the state, citing a nonpartisan study predicting hundreds of millions in annual revenue losses from departures. The Democratic nominee to replace Newsom, Xavier Becerra, also opposes the tax, while Republican nominee Steve Hilton says it would 'destroy' the state. Proponents, including law professor David Gamage, argue the tax will maintain California's standard of living and point to international examples like Norway, where the long-term economic impact of wealth taxes remains unclear. Nvidia CEO Jensen Huang, who could face an $8 billion bill, said he is 'perfectly fine with it,' while Google co-founder Sergey Brin has funded lobbying against the measure.