California has seen an astonishing loss of nearly $1 trillion in wealth over the last month, primarily due to worries surrounding a proposed “billionaire tax,” as noted by a prominent state resident.
This significant measure, which even left-leaning Governor Gavin Newsom opposes, would introduce a one-time 5% tax on individuals with assets exceeding $1 billion starting January 1, 2026.
“The total wealth of billionaires who left California last month is over $700 billion,” expressed Chamath Palihapitiya, a venture capitalist and former Facebook executive, during a post on X last Friday.
He further highlighted, “Now, the projected $2 trillion in California wealth to be taxed has dropped to $1.3 trillion and continues to decrease.”
Palihapitiya speculated, “By the end of 2026, California billionaires might possess less than $1 trillion in total assets, which is still quite a lot—but, you know, enough to buy the entire NFL a few times over.”
He also questioned, “What happened to the governor? Where was our leader?” showcasing his frustration.
Just the thought of this tax led many of California’s approximately 215 billionaires to invest in properties in states like Florida and Tennessee, along with relocating some of their business operations outside California.
For instance, Larry Page, a co-founder of Google, has seen more than 45 LLCs associated with him either pause operations or move out after a trust linked to him acquired a mansion in Miami for $71.9 million.
Moreover, Sergey Brin, another Google co-founder, recently dissolved or shifted 15 California LLCs tied to his business interests to Reno, Nevada.
In-N-Out heiress, Lynsi Snyder, has also moved to Tennessee and opened a secondary headquarters there.
Palihapitiya mentioned he was “seriously considering” moving to Texas, though some financial analysts caution that this trend might just be the beginning.
“If this tax initiative fails and those individuals aren’t incentivized to return, California’s budget will face serious challenges,” he remarked.
He added, “The only way to recover funds is to cut down on waste, fraud, and abuse or raise taxes on the middle class. The latter is far simpler.”
Meanwhile, the SEIU United Health Care Workers West union, which is advocating for the Billionaire Tax Act of 2026, argues that the tax revenue would be crucial for restoring healthcare funding that was lost due to federal budget reductions, as well as for supporting California’s public education system.
Suzanne Jimenez, the Chief of Staff for SEIU-UHW, claimed that this wealth tax is “literally a dollar-for-dollar solution” to the federal healthcare cuts.
She also positioned the one-time 5% wealth tax as “a very minor tax,” insisting that even with this tax, billionaires would still earn less than in the Reagan era.
Notably, even Governor Newsom, who typically supports progressive policies, is firmly against this tax measure, his team stated.
“The governor has consistently opposed state-level wealth taxes, including this one, since such measures risk provoking a downward spiral,” Representative Izzy Gurdon shared.
According to a recent poll shared with The Post, most Californians seem to back Newsom’s viewpoint. The survey, conducted by David Binder Research, revealed that after respondents reviewed both perspectives, support for the tax dropped to just 41%, while opposition rose to 53%.
