A coalition of California billionaires and their advisers is mounting a major campaign to defeat Proposition 40, a ballot measure proposing a one-time 5 percent wealth tax on the state’s wealthiest residents. Organized by the nonprofit Building a Better California, the effort has raised over $333 million, making it one of the largest political fundraising operations in the state’s history. The campaign includes prominent figures from Silicon Valley such as Sergey Brin, Eric Schmidt, Patrick Collison, and John Doerr.
The proposed tax, which appears on the ballot this week, targets billionaires with the intent of addressing economic inequality and funding healthcare programs. However, many of California’s wealthiest oppose the measure, arguing it would harm the state’s economy and job creation. Organizers of the opposition contend that the tax threatens business investment and could damage California’s tax base permanently.
The campaign, which began in late 2025, was initially sparked by Sergey Brin, co-founder of Google, who relocated from California to Nevada to avoid the measure. Brin, who has donated $102 million to the effort, has since stepped back somewhat, encouraging other donors to increase their contributions. Building a Better California coordinates weekly conference calls among two dozen influential donors and advisers to strategize on polling, advertising buys, and opposition research. Fundraising requests often encourage tech billionaires to donate a portion of their net worth, with a large share of contributions coming in the form of appreciated stock rather than cash, allowing donors to avoid capital gains taxes.
The opposition campaign remains cautious about presenting billionaires as the public face of the effort due to widespread populist sentiments against wealth concentration. Polling data reviewed by the group indicated a negative public perception of billionaires, prompting them to focus on messaging that emphasizes innovation, job creation, and economic growth. A spokeswoman for Building a Better California stated that their supporters have “created companies, entirely new industries and hundreds of thousands of jobs here in California” and that they want the state to remain a hub for opportunity.
Meanwhile, some opponents of the measure note that the tax’s application on illiquid assets, such as private startup shares, would unfairly burden founders of companies that have not yet gone public. This concern resonates with several tech entrepreneurs who have voiced frustrations about the novel approach to taxing wealth.
The campaign has also backed Proposition 42, a related ballot measure intended to block future wealth taxes constitutionally, thereby serving as a safeguard should Proposition 40 pass. While some donors, including Eric Schmidt, initially expressed reservations about focusing on Proposition 42, he has nonetheless contributed over $40 million. This multifaceted strategy aims not only to defeat Proposition 40 but also to discourage similar wealth tax initiatives nationally.
Governor Gavin Newsom has expressed opposition to Proposition 40 and attempted to negotiate its removal from the ballot earlier in the year but was unsuccessful. The wealth tax supporters seek funds specifically for healthcare programs in California, backed by labor unions.
As California voters prepare to weigh in, the battle over Proposition 40 reflects a broader national debate over taxation, wealth inequality, and the role of billionaires in economic policy. Both sides agree on the importance of the state’s economic future but differ sharply on the best path forward.