Zuckerberg weighs move out of California as Prop 40 wealth levy nears

California residents who hold assets exceeding one billion dollars face a potential one-time levy of 5% on their net worth if voters approve Proposition 40 in November. The measure targets a little more than 200 individuals, including Oprah Winfrey, Mark Zuckerberg, Kim Kardashian, and George Lucas. If passed, the tax would apply retroactively to anyone meeting the wealth threshold who lived in the state as of January 1, 2026.

Proponents argue the levy will raise $100 billion to offset federal funding cuts to the state’s healthcare system. Suzanne Jimenez, a leader with the Service Employees International Union-United Healthcare Workers West, described the proposal as a short-term solution to prevent a collapse in medical services. She told the BBC that inaction would lead to systemic failure while longer-term funding models are developed. The state, which holds the fourth-largest economy globally, has the nation's largest homeless population and one of its widest wealth gaps.

Governor Gavin Newsom, whose term ends this year, opposes the measure, warning it may drive wealthy residents and their income tax revenue out of the state. A September poll conducted by the Los Angeles Times and the Berkeley Institute of Governmental Studies found that 45% of likely voters support the tax, 42% oppose it, and 13% are undecided. A simple majority is required for the proposal to pass. Google co-founder Sergey Brin has donated over $100 million to a political organization funding efforts to block the measure.

Several high-profile billionaires have already relocated. At least six residents, including Google co-founders Larry Page and Sergey Brin, venture capitalist Peter Thiel, former Uber chief Travis Kalanick, and Hankey Group founder Don Hankey, have reportedly left the state. Hankey told Forbes he moved to Nevada because the proposal made him feel unwelcome. Meta chief Mark Zuckerberg told his board last month he is considering moving his primary residence out of California. Meta agreed to a new stock deal to help him cover potential losses, which could reach $12.5 billion.

Support among the wealthy is not absent. Nvidia chief Jensen Huang told CBS that he is comfortable paying higher taxes as his income rises. Senator Bernie Sanders stated at a Los Angeles rally that billionaires believe they have a divine right to rule and would learn a lesson in the vote. Washington state voters are simultaneously weighing a 9.9% tax on income over $1 million, a move that aligns with a broader global trend of examining wealth levies.

Dr. Kristian Niemietz of the Institute of Economic Affairs noted that only Spain, Norway, and Switzerland currently maintain wealth taxes, describing such levies as more trouble than they are worth. Francesco Trebbi, a public policy professor at the University of California, Berkeley, said the measure targets the extreme percentile of the wealth distribution. He described the drive behind the proposal as an anti-elite sentiment aimed at re-balancing the economic scale.