Story perspectives

Proposition 40 Lands on 2026 Ballot, Faces Challenge

By Drooid · Oct 16, 2026, 10:38 PM UTC · How we work

Summary

Story summary

Proposition 40, a one-time 5% tax on billionaires’ net worth, will appear on the Nov. 3, 2026 ballot.
Opponents have raised more than $300 million, while supporters have raised under $10 million.
Governor Gavin Newsom and the California Democratic Party oppose Proposition 40 and back Proposition 42 to block it.
The California Business Roundtable hired former U.S. Solicitor General Elizabeth Prelogar to lead a legal challenge if Proposition 40 passes.

History

Historical Context

The United States ratified the Sixteenth Amendment in 1913, authorizing a federal income tax that introduced progressive rates on personal wealth. Congress, under President Woodrow Wilson, set an initial top marginal rate of 7%, producing $1.5 billion in revenue during its first fiscal year. Today, California’s Proposition 40 proposes a one-time 5% billionaire wealth tax, opposed by Governor Gavin Newsom, the Democratic Party, and the Business Roundtable. If passed, the measure could reshape state revenue models, echoing early 20th-century debates over equitable taxation and prompting future legal challenges.

1 of 2

Story summary

Proposition 40, a one-time 5% tax on billionaires’ net worth, will appear on the Nov. 3, 2026 ballot.
Opponents have raised more than $300 million, while supporters have raised under $10 million.
Governor Gavin Newsom and the California Democratic Party oppose Proposition 40 and back Proposition 42 to block it.
The California Business Roundtable hired former U.S. Solicitor General Elizabeth Prelogar to lead a legal challenge if Proposition 40 passes.

1 / 2