A California ballot initiative backed by organized labor to impose a temporary 5% tax on billionaires cleared a major hurdle Monday, with its backers saying they have enough signatures to qualify for the November ballot. The initiative would apply to individuals with net worth over $1 billion who lived in the state as of Jan. 1, 2026, and backers said the measure is designed to raise $100 billion. The California secretary of state still must verify the signatures and formally place the measure on the ballot.
Supporters said the money would largely be used to offset federal funding cuts to healthcare for low-income people. The union backing the initiative, Service Employees International Union Healthcare Workers West, framed the proposal as a response to strain in the health care system, arguing that rising costs and closures threaten patients.
Liz Perlman, executive director of an American Federation of State, County and Municipal Employees chapter and a labor leader backing the effort, argued that the impact is already being felt in communities. “California’s health is at stake,” Perlman said. “Hospitals are closing and people will die. Why? So billionaires can get another tax cut that they don’t need.”
Backers said they collected more than 1.5 million signatures, which they said would exceed the roughly 875,000 signatures required to qualify under California rules. The campaign also highlighted that ballot initiative drives can pay people per signature, and that the cost of collecting petition signatures can vary widely, often running around $15 per signature.
If voters see the measure on the fall ballot, it could become a high-spending fight that draws national attention, supporters and opponents said. The proposal has backing from prominent political figures including Vermont Sen. Bernie Sanders, and it is also drawing attention from donors aligned with groups seeking to blunt any new billionaire tax.
Opponents of the initiative, including Democratic Gov. Gavin Newsom and Silicon Valley tech leaders, have argued that it would drive wealthy residents out of California. They also argue that nearly half of California’s personal income tax revenue comes from the top 1% of earners, and that some wealthy people have already bought properties elsewhere in preparation for the outcome.
Sergey Brin, the founder of Google, has donated $57 million to a political committee called “Building a Better California,” which supports a slate of initiatives aimed at countering the billionaire tax proposal. According to backers’ opponents, that committee has raised over $90 million in total, including Brin’s contributions, from fewer than a dozen donors.
The tax fight has also produced sharper rhetoric from the professional and political sides. David Lesperance, a tax consultant who said he has advised wealthy clients who left California because of the proposal, argued Monday that the effort would lead to relocation. “After playing with matches since October, the SEIU has succeeded in lighting a ‘Tax the Rich’ wildfire by getting enough signatures,” Lesperance said. “The many billionaire targets of their efforts have already responded by executing fire escape plans by relocating to other states.”
Brian Brokaw, a longtime Newsom adviser who is leading a political committee opposing the tax measure, said the initiative is not designed with fiscal stability in mind. Brokaw argued in a statement that the proposal is “poorly constructed” and that it would deal “a huge blow to the state’s budget.” He said in the same statement that “enacting a so-called wealth tax in just one state wouldn’t target a small group,” adding that it would affect “all 40 million Californians,” and warned that it “trades a short-term revenue bump for long-term losses.”
A key issue for the measure, should it reach voters, will be the challenge of defining who qualifies under the initiative’s residency rule. The Associated Press reviewed Forbes magazine’s 2025 ranking of the world’s 500 wealthiest people and found that at least 25 billionaires either lived in California or had significant ties to the state. Determining whether they were full-time residents or only frequent visitors could become a point of dispute because many own property elsewhere.
The ballot fight is unfolding as opponents point to the broader federal context of budget cuts. The AP said that a large tax and spending bill President Donald Trump signed last year would cut more than $1 trillion nationwide over a decade from Medicaid and federal food assistance, framing the California initiative as one potential response to federal reductions that affect health services and support programs.