{"id":18041,"date":"2026-08-18T19:06:25","date_gmt":"2026-08-18T19:06:25","guid":{"rendered":"https:\/\/nile1.com\/en\/?p=18041"},"modified":"2026-08-18T19:06:32","modified_gmt":"2026-08-18T19:06:32","slug":"tech-billionaires-spend-millions-to-defeat-california-proposition-40-wealth-tax","status":"publish","type":"post","link":"https:\/\/nile1.com\/en\/2026\/08\/18\/tech-billionaires-spend-millions-to-defeat-california-proposition-40-wealth-tax\/","title":{"rendered":"Tech Billionaires Spend Millions to Defeat California Proposition 40 Wealth Tax"},"content":{"rendered":"

Prominent Silicon Valley founders and venture capitalists are pouring millions of dollars into political committees aimed at defeating Proposition 40<\/a>, a November ballot measure that would impose a one-time 5% wealth tax<\/a> on California\u2019s billionaires.<\/p>\n

Campaign finance filings reveal that crypto billionaire Chris Larsen personally donated $5 million to Golden State Promise, an anti-Proposition 40 political action committee. Ripple Labs, the company Larsen cofounded, contributed an additional $5 million to the committee.<\/p>\n

Another committee opposing the measure, representing doctors, teachers, and small businesses, received $5 million from Building a Better California. Campaign records identify Google cofounder Sergey Brin and longtime venture capitalist John Doerr as the top financial backers of Building a Better California. Brin has recently reduced his official and financial ties to the state.<\/p>\n

Palantir cofounder Peter Thiel<\/a> contributed $3 million to the California Business Roundtable Issues PAC, which in turn directed $450,000 to Golden State Promise. Thiel officially severed ties with California in 2025 in advance of the wealth tax proposal.<\/p>\n

An analysis by Wealth Management indicates that a resident with a net worth of $1.1 billion would face a $55 million tax liability under the proposed law. If passed, the ballot measure is projected to raise $100 billion over five years from approximately 250 billionaires. State plans call for earmarking 90% of those funds for health care, with the remainder supporting food assistance and education.<\/p>\n

The ballot measure has triggered intense debate over whether taxing extreme wealth threatens the state\u2019s startup ecosystem. Entrepreneur Mark Cuban<\/a> warned on X that the policy misinterprets paper wealth, writing that “if this passes, only idiot startup founders stay in Cali” because many founders lack liquid cash to pay massive upfront bills.<\/p>\n

Rep. Ro Khanna<\/a> (D-Calif.), a prominent defender of the measure, pushed back against Cuban’s argument, noting that truly illiquid paper billionaires represent only a fraction of the targeted population. Khanna suggested a framework allowing cash-poor founders to transfer startup shares to the state as collateral for a loan to satisfy the tax obligation, asserting that the government would still collect from the vast majority of billionaires who hold liquid assets.<\/p>\n

Addressing liquidity concerns, Emmanuel Saez, director of UC Berkeley\u2019s James M. and Cathleen D. Stone Center on Wealth and Income Inequality and co-author of an expert report on Proposition 40, noted that founders without immediate cash can utilize a deferral option. Under that mechanism, individuals pay 5% on future business proceeds, such as dividends or stock sales. “If the business fails, they won\u2019t have to pay anything,” Saez said. “If the business succeeds, they\u2019ll have to pay 5% of that success eventually.”<\/p>\n

The debate extends beyond state lines. In March, Khanna and Sen. Bernie Sanders (I-Vt.) introduced federal legislation proposing an annual 5% wealth tax on Americans worth more than $1 billion, designed in part to fund $3,000 payments to lower- and middle-income households.<\/p>\n

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