Khanna, Sanders Back California Billionaire Tax Initiative as Newsom Warns It Could Drive Out Top 0.1%

Q: Why does a November tax vote depend on who lived in California last January?

It depends on who lived in California on Jan. 1, 2026 because the ballot measure is written to tax people based on that specific residency date, not just on whether they live in the state when voters cast ballots in November. Under the proposed 2026 California Billionaire Tax Act, a one-time 5% levy would apply to net worth above $1 billion for people who were California residents on Jan. 1, 2026, with wealth measured at the end of 2026. In practice, that means someone who lived in California on that January date could still be targeted even if they moved away before the election or before the tax is collected. Supporters chose that early “snapshot” to stop wealthy residents from leaving in advance and shrinking the tax base. That design is central to the measure’s revenue promise, because the amount raised depends heavily on how many billionaires can still be counted under that Jan. 1 rule. But that same feature is also a major legal weakness. Opponents argue it is retroactive because voters would be approving a new tax in November based on residency months earlier. Legal analysts also say taxing someone’s full global wealth after they have left the state could raise due process, right-to-travel and fair-apportionment challenges. So the November vote depends on last January’s residency because the initiative tries to lock in who can be taxed before the election happens — and whether that survives in court may determine how much of the tax, if any, can actually be enforced.

3 articles · Updated · POLITICO · Jul 18

Ro Khanna and Bernie Sanders have emerged as the highest-profile elected backers of a California ballot initiative to tax billionaires, giving a Washington push to a campaign that has otherwise won little support from officeholders.
Supporters frame the measure as a response to Donald Trump’s agenda and a chance for Democrats to sharpen a populist economic message centered on taxing extreme wealth.
Gavin Newsom and other California Democrats oppose the initiative, arguing it could destabilize state finances by pushing wealthy residents to leave.
The campaign also faces a steep money gap: opponents are expected to heavily outspend supporters, with rivals including Sergey Brin as well as Democrat-aligned groups such as Planned Parenthood and the California Teachers Association.