California billionaires flee state’s wealth tax in the most-predictable result ever

It’s a governmental earthquake. The wealthiest Californians are fleeing the authorities and taking their capital, resources and companies with them.  

The SEIU United Healthcare Workers West, a statewide national of work employees successful California, introduced a ballot measurement called the Billionaire Tax Act, to instrumentality a one-time 5% taxation connected the nett worthy implicit $1 cardinal connected immoderate California resident. The taxation is connected full nett worth, not income, and would snag affluent radical who person the bulk of their wealthiness successful banal oregon property. 

The thought has yet to beryllium voted on, and supporters of the measurement volition request astir a cardinal signatures by precocious June to get it connected the ballot for November 2026.  

But affluent Californians are already moving for the doorway due to the fact that the connection successful the draught of the measurement sets the taxation retroactively to January 1, 2026, and they cognize they can’t trust connected their chap Californians to ballot down the absurd proposal.

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Google co-founder Larry Page and Oracle laminitis Larry Ellison go immoderate of the latest high-profile California concern leaders to divest from the state. (Eric Risberg/AP Photo; AP)

Suzanne Jimenez, a main of unit for SEIU-UHW who introduced the measure, calls it "a precise insignificant tax." 

Larry Page and Sergey Brin, co-founders of Google, are the latest to bail connected California. Garry Tan, president & CEO of Y Combinator and self-described "San Francisco Democrat" explained connected X that the wealthiness taxation wouldn’t really extremity up being "5%" of a billionaire’s nett worth.  

"Larry and Sergey can’t enactment successful California since the wealthiness taxation arsenic written would confiscate 50% of their Alphabet shares. Each ain ~3% of Alphabet's stock, worthy astir $120 cardinal each astatine today's ~$4 trillion marketplace cap. But due to the fact that their shares person 10x voting power, the SEIU-UHW California billionaire taxation would dainty them arsenic owning 30% of Alphabet (3% × 10 = 30%). That means each founder's taxable wealthiness would beryllium $1.2 trillion. A 5% wealthiness taxation connected $1.2 trillion = $60 cardinal taxation bill, each. That's 50% of their existent Alphabet holdings—wiped retired by a '5%’ tax."

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This connection isn’t an accident. Asset seizure is the eventual program of the socialists penning these proposals. Wealth isn’t to beryllium permitted successful the socialist utopia and indispensable beryllium redistributed.  

Chamath Palihapitiya, a tech billionaire and 1 of the hosts of the "All-In" podcast, hasn’t near yet but is weighing his options. Palihapitiya puts the fig of billionaire wealthiness that has near California successful conscionable the past period "in excess of $700B." He explains that the magnitude of wealthiness the connection hoped to taxation has already importantly decreased. 

"That means the $2T of California wealthiness they expected to taxation is present down to $1.3T and falling quickly. I would not beryllium amazed if 2026 ended with little than $1T of billionaire wealthiness successful California and decades and hundreds of lawsuits. A implicit and full unforced error. Where was the Governor? Where are our leaders??" 

That’s a bully question, and billionaires who specifically supported Democrat Gov. Gavin Newsom and the remainder of the Democratic governmental apparatus successful California should beryllium demanding an answer.

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Palihapitiya is hoping the measurement is voted down and California volition enactment to "entice those folks to travel back" or, helium warns, "the California fund volition beryllium massively upside down." But wherefore would they return? Billionaires are quality and moving their full lives, often uprooting their kids and moving them to caller schools, isn’t truthful elemental to undo. And anyway, a measurement similar this could beryllium introduced again astatine immoderate clip and, successful fact, Assemblymember Alex Lee, D-San José, has for years pushed a akin wealthiness taxation albeit astatine lone a humble 1.5% confiscation rate.  

But affluent Californians are already moving for the doorway due to the fact that the connection successful the draught of the measurement sets the taxation retroactively to January 1, 2026, and they cognize they can’t trust connected their chap Californians to ballot down the absurd proposal.

When the billionaires don’t return, due to the fact that they’ve acceptable up their lives elsewhere and realized a full satellite exists extracurricular California, the politicians volition person to marque up the shortfall elsewhere. Non-billionaires are paying attention. Jesse Tinsley, CEO and laminitis of respective companies including Mainstreet.com, announced connected Sunday, Jan. 11, "Add maine to the list…headed to Florida." Tinsley, who openly supported President Donald Trump successful the past statesmanlike election, isn’t a billionaire but helium sees the penning connected the wall. If each the billionaires bail to debar the imaginable tax, the people of affluent beneath them volition beryllium targeted next.

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Those who supported the unspeakable politicians and backward policies that led to this infinitesimal should person to enactment and woody with the consequences of what they’ve done. Reid Hoffman, a co-founder of LinkedIn and a billionaire celebrated for supporting Democrats, is astir to go the surviving embodiment of the net joke, "I ne'er thought leopards would devour MY face,' sobs pistillate who voted for the Leopards Eating People's Faces Party." Hoffman considered leaving the United States aft Trump was elected successful 2024 truthful helium can’t precisely bolt for a reddish authorities to assistance support his assets from the precise radical helium helped elect.  

Bad ideas person consequences and California has played a crippled of chickenhearted with the acold near and it looks similar the acold near is winning. As the billionaire exodus continues, those exiting should internalize what went incorrect successful their location authorities and purpose not to repetition it successful their caller locale. California has go synonymous with failure. Leave that nonaccomplishment astatine home. 

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