Opponents led 52.6% to 47.4% in Tuesday’s state count as the Associated Press declared defeat for a one-time wealth tax meant mostly for health care.
California voters have rejected Proposition 40, the proposed one-time tax on billionaires’ wealth. The Associated Press declared the measure defeated Monday night, the Los Angeles Times reported.
In the Secretary of State’s Nov. 10, 5:31 p.m. update, 6,205,615 votes had been cast against the measure, or 52.6%, and 5,593,408 in favor, or 47.4%, a gap of 612,207 votes.
Those figures are unofficial. About 1.5 million ballots statewide were still to be processed as of Tuesday night, Lake County News reported, citing the Secretary of State’s office. The Secretary of State will certify results Dec. 11, according to a Nov. 5 news release.
The AP put the vote at 52.8% to 47.2% when it called the race, CalMatters reported. The measure had trailed since counting began, according to the Times.
“Proposition 40 was a reckless experiment conducted on our state’s economy with little regard for the harms it would cause,” Evan Westrop, a campaign strategist for No on Prop. 40, said in a statement reported by CalMatters.
Supporters blamed the loss on spending by billionaires. “Billionaire-funded propaganda may have influenced the outcome of this election, but as hospitals reduce services, emergency rooms close and families lose access to care, the truth will become increasingly difficult to hide,” said Suzanne Jimenez, chief of staff for SEIU-UHW, the union that sponsored the measure, according to the Times.
Union leaders said they would bring a billionaire tax back to the 2028 ballot if state leaders do not find another way to fund health care, the Times and CalMatters reported.
Ultra-wealthy opponents gave $378.4 million to fight the tax, while the Yes campaign raised $33.5 million, according to CalMatters. Gov. Gavin Newsom opposed Prop 40, the outlet reported.
Prop 40 would have imposed a one-time wealth tax of up to 5% on affected billionaires’ taxable net worth, with reduced rates for individuals below $1.1 billion. Most of the proceeds would have been reserved for health care, according to the official voter guide’s Legislative Analyst analysis.
Under that analysis, the tax would have applied to billionaires who were California residents on Jan. 1, 2026. Payment would have been due in 2027, with an option to pay over five years at an additional cost. Real estate, pensions, and retirement accounts generally would have been excluded.
After administrative expenses, 90% of the remaining money would have gone to health care and 10% to education and food assistance. The Legislative Analyst had estimated temporary collections of tens of billions of dollars over several years.
The Secretary of State’s quick guide listed Sen. Bernie Sanders and SEIU United Healthcare Workers West among supporters. Listed opponents included the California Primary Care Association, California School Boards Association, and California Taxpayers Association.
Counties will keep tallying ballots in the weeks ahead before the Dec. 11 certification.
