Nobel Economists Backed California Billionaire Tax Measure

The proposed 5% wealth tax seeks to raise $100 billion to offset future state Medicaid funding cuts.

Updated on Sept. 20, 2026 in Financial Planning

Bold flat-color editorial illustration featuring a geometric silhouette of the California State Capitol dome, evoking institutional fiscal policy. — Six Nobel laureates endorsed California's Proposition 40, a wealth tax measure on the November 2026 ballot aimed at funding state Medicaid services. AI Illustration. Upload story photo >

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Do you support implementing a one-time wealth tax on billionaires to fund state public services?

Six Nobel Prize-winning economists have officially endorsed California's Proposition 40, a measure slated for the November 3, 2026, ballot. If passed, the initiative would impose a one-time 5% tax on the wealth of California's approximately 250 billionaires to fund state services.

Why it matters

Economists suggest the levy is necessary to address projected shortfalls in Medicaid funding at the state level. The measure directly impacts the tax obligations of the wealthiest 0.001% of state residents, who hold a combined $2.3 trillion in assets.

Proposition 40 would levy a 5% tax on the wealth of California's 250 billionaires, who currently possess $2.3 trillion in combined assets. For individual taxpayers like Chris Larsen, this represents a potential $420 million tax obligation if the ballot initiative is approved.

The players

Chris Larsen

An entrepreneur with a $8.4 billion net worth who has contributed $10 million to defeat the tax.

Sergey Brin

A billionaire who has invested $102 million into PACs to oppose the passage of the tax.

John Doerr

A prominent investor who contributed $7.5 million toward committees working to defeat the measure.

The details

The proposal targets the total net worth of the state's wealthiest individuals rather than annual income, aiming to capture revenue that has historically seen a 1.6% effective tax rate. Opponents, including high-net-worth individuals like Sergey Brin and Chris Larsen, have spent over $100 million through political action committees to defeat the measure. Additionally, groups like Building a Better California have introduced Propositions 41 and 42 to offer voters a mechanism to cancel the tax if those measures also pass.

2019-2025: Period analyzed for billionaire wealth gains.
Late 2025: Sergey Brin moved assets out of the state.
September 19, 2026: Nobel economists officially endorsed the tax.
November 3, 2026: Date of the public ballot vote.

Money Landscape

This proposal follows a pattern set by debates over state-level budgetary autonomy versus reliance on federal grant funding. It represents a significant shift from traditional income-based taxation, aiming to use asset-based wealth to fill potential state-level Medicaid gaps.

While the tax specifically targets billionaires, the measure's potential $100 billion revenue injection could influence state Medicaid access for middle-income households. Consult a tax professional to understand how ballot-level changes may impact your long-term state tax liability planning.

The takeaway

The proposal highlights a tension between state revenue needs and the tax treatment of high-net-worth asset growth. Voters should monitor the campaigns of PACs like Golden State Promise as the November ballot deadline approaches to understand the potential fiscal impact on state services.