You may have read that radical California politicians and public sector unions are demanding a “one-time” tax on billionaires to fund the state’s healthcare system. The idea of taxing unrealized wealth isn’t new, but targeting the most mobile demographic with such a narrowly targeted punitive tax is already causing some to flee. In The Wall Street Journal, Jon Hartley and Art Laffer explain the tax, writing:
California is flirting with a new and destructive tax. A proposed ballot initiative, the 2026 Billionaire Tax Act, would impose a one-time 5% levy on the net worth of California residents with more than $1 billion, calculated as of Jan. 1, 2026, with payment due in 2027 and an option to spread payments over five years at an added charge.
While the tax would be a “one-time event,” nothing would prohibit similar initiatives in the future. Supporters call it a tax on billionaires, but in practice it would be a giant, government-mandated liquidation event for people whose wealth is often tied up in illiquid business equity. It also contains a feature that should make any taxpayer uneasy: It would be retroactive to the start of 2026.
The tax is so dangerous that even the state’s Governor Gavin Newsom is having second thoughts. San Jose Mayor Matt Mahan also opposes the tax because it will drive wealthy residents out of the state. CBS LA reports in the video below:
Action Line: States are laboratories of democracy. Their leaders’ good or bad decisions can not only be voted on at the polls, but also with dollars. Wealthy residents of any state will flee when politicians treat them like a piggy bank from which they can withdraw funds to support their wasteful spending. Businesses can also make decisions to uproot. If you’re looking for a better America, begin your search with Your Survival Guy’s 2025 Super States. And click here to subscribe to my free monthly Survive & Thrive letter, and be among the first to receive my forthcoming 2026 Super States.
